Correlation Between Xponential Fitness and Enersys
Can any of the company-specific risk be diversified away by investing in both Xponential Fitness and Enersys 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 Enersys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xponential Fitness and Enersys, you can compare the effects of market volatilities on Xponential Fitness and Enersys 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 Enersys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xponential Fitness and Enersys.
Diversification Opportunities for Xponential Fitness and Enersys
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xponential and Enersys is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Xponential Fitness and Enersys in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enersys 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 Enersys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enersys has no effect on the direction of Xponential Fitness i.e., Xponential Fitness and Enersys go up and down completely randomly.
Pair Corralation between Xponential Fitness and Enersys
Given the investment horizon of 90 days Xponential Fitness is expected to generate 2.74 times more return on investment than Enersys. However, Xponential Fitness is 2.74 times more volatile than Enersys. It trades about 0.01 of its potential returns per unit of risk. Enersys is currently generating about 0.02 per unit of risk. If you would invest 2,539 in Xponential Fitness on November 19, 2024 and sell it today you would lose (806.00) from holding Xponential Fitness or give up 31.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xponential Fitness vs. Enersys
Performance |
| Timeline |
| Xponential Fitness |
| Enersys |
Xponential Fitness and Enersys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xponential Fitness and Enersys
The main advantage of trading using opposite Xponential Fitness and Enersys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xponential Fitness position performs unexpectedly, Enersys 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 Enersys will offset losses from the drop in Enersys' long position.| Xponential Fitness vs. Planet Fitness | Xponential Fitness vs. JAKKS Pacific | Xponential Fitness vs. Acushnet Holdings Corp | Xponential Fitness vs. OneSpaWorld Holdings |
| Enersys vs. Advanced Energy Industries | Enersys vs. Hubbell | Enersys vs. Acuity Brands | Enersys vs. Kimball Electronics |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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