Correlation Between Xponential Fitness and Universal Display
Can any of the company-specific risk be diversified away by investing in both Xponential Fitness and Universal Display 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 Universal Display into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xponential Fitness and Universal Display, you can compare the effects of market volatilities on Xponential Fitness and Universal Display 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 Universal Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xponential Fitness and Universal Display.
Diversification Opportunities for Xponential Fitness and Universal Display
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Xponential and Universal is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Xponential Fitness and Universal Display in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Universal Display 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 Universal Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Universal Display has no effect on the direction of Xponential Fitness i.e., Xponential Fitness and Universal Display go up and down completely randomly.
Pair Corralation between Xponential Fitness and Universal Display
Given the investment horizon of 90 days Xponential Fitness is expected to under-perform the Universal Display. In addition to that, Xponential Fitness is 2.27 times more volatile than Universal Display. It trades about 0.0 of its total potential returns per unit of risk. Universal Display is currently generating about 0.03 per unit of volatility. If you would invest 13,749 in Universal Display on August 29, 2024 and sell it today you would earn a total of 2,431 from holding Universal Display or generate 17.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xponential Fitness vs. Universal Display
Performance |
| Timeline |
| Xponential Fitness |
| Universal Display |
Xponential Fitness and Universal Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xponential Fitness and Universal Display
The main advantage of trading using opposite Xponential Fitness and Universal Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xponential Fitness position performs unexpectedly, Universal Display 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 Universal Display will offset losses from the drop in Universal Display's long position.| Xponential Fitness vs. Planet Fitness | Xponential Fitness vs. Bowlero Corp | Xponential Fitness vs. JAKKS Pacific | Xponential Fitness vs. Acushnet Holdings Corp |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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