Correlation Between XWELL and Mister Car
Can any of the company-specific risk be diversified away by investing in both XWELL and Mister Car 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 XWELL and Mister Car into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between XWELL Inc and Mister Car Wash, you can compare the effects of market volatilities on XWELL and Mister Car 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 XWELL with a short position of Mister Car. Check out your portfolio center. Please also check ongoing floating volatility patterns of XWELL and Mister Car.
Diversification Opportunities for XWELL and Mister Car
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between XWELL and Mister is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding XWELL Inc and Mister Car Wash in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mister Car Wash and XWELL 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 XWELL Inc are associated (or correlated) with Mister Car. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mister Car Wash has no effect on the direction of XWELL i.e., XWELL and Mister Car go up and down completely randomly.
Pair Corralation between XWELL and Mister Car
Given the investment horizon of 90 days XWELL Inc is expected to under-perform the Mister Car. But the stock apears to be less risky and, when comparing its historical volatility, XWELL Inc is 1.29 times less risky than Mister Car. The stock trades about -0.27 of its potential returns per unit of risk. The Mister Car Wash is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 640.00 in Mister Car Wash on August 25, 2024 and sell it today you would earn a total of 160.00 from holding Mister Car Wash or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
XWELL Inc vs. Mister Car Wash
Performance |
| Timeline |
| XWELL Inc |
| Mister Car Wash |
XWELL and Mister Car Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with XWELL and Mister Car
The main advantage of trading using opposite XWELL and Mister Car positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XWELL position performs unexpectedly, Mister Car 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 Mister Car will offset losses from the drop in Mister Car's long position.| XWELL vs. Mister Car Wash | XWELL vs. Interactive Strength Common | XWELL vs. Goodfood Market Corp | XWELL vs. Frontdoor |
| Mister Car vs. Bright Horizons Family | Mister Car vs. Smart Share Global | Mister Car vs. Carriage Services | Mister Car vs. Frontdoor |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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