Correlation Between Xponential Fitness and Duluth Holdings
Can any of the company-specific risk be diversified away by investing in both Xponential Fitness and Duluth Holdings at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Xponential Fitness and Duluth Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xponential Fitness and Duluth Holdings, you can compare the effects of market volatilities on Xponential Fitness and Duluth Holdings and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Xponential Fitness with a short position of Duluth Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xponential Fitness and Duluth Holdings.
Diversification Opportunities for Xponential Fitness and Duluth Holdings
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Xponential and Duluth is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Xponential Fitness and Duluth Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Duluth Holdings and Xponential Fitness is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Xponential Fitness are associated (or correlated) with Duluth Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Duluth Holdings has no effect on the direction of Xponential Fitness i.e., Xponential Fitness and Duluth Holdings go up and down completely randomly.
Pair Corralation between Xponential Fitness and Duluth Holdings
Given the investment horizon of 90 days Xponential Fitness is expected to generate 2.23 times more return on investment than Duluth Holdings. However, Xponential Fitness is 2.23 times more volatile than Duluth Holdings. It trades about 0.18 of its potential returns per unit of risk. Duluth Holdings is currently generating about 0.07 per unit of risk. If you would invest 1,225 in Xponential Fitness on September 1, 2024 and sell it today you would earn a total of 299.00 from holding Xponential Fitness or generate 24.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xponential Fitness vs. Duluth Holdings
Performance |
| Timeline |
| Xponential Fitness |
| Duluth Holdings |
Xponential Fitness and Duluth Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xponential Fitness and Duluth Holdings
The main advantage of trading using opposite Xponential Fitness and Duluth Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xponential Fitness position performs unexpectedly, Duluth Holdings can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Duluth Holdings will offset losses from the drop in Duluth Holdings' long position.| Xponential Fitness vs. The Wendys Co | Xponential Fitness vs. Shake Shack | Xponential Fitness vs. Papa Johns International | Xponential Fitness vs. Darden Restaurants |
| Duluth Holdings vs. Capri Holdings | Duluth Holdings vs. Movado Group | Duluth Holdings vs. Tapestry | Duluth Holdings vs. Brilliant Earth Group |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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