Correlation Between YETI Holdings and Xponential Fitness
Can any of the company-specific risk be diversified away by investing in both YETI Holdings and Xponential Fitness 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 YETI Holdings and Xponential Fitness into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between YETI Holdings and Xponential Fitness, you can compare the effects of market volatilities on YETI Holdings and Xponential Fitness 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 YETI Holdings with a short position of Xponential Fitness. Check out your portfolio center. Please also check ongoing floating volatility patterns of YETI Holdings and Xponential Fitness.
Diversification Opportunities for YETI Holdings and Xponential Fitness
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between YETI and Xponential is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding YETI Holdings and Xponential Fitness in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xponential Fitness and YETI Holdings 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 YETI Holdings are associated (or correlated) with Xponential Fitness. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xponential Fitness has no effect on the direction of YETI Holdings i.e., YETI Holdings and Xponential Fitness go up and down completely randomly.
Pair Corralation between YETI Holdings and Xponential Fitness
Given the investment horizon of 90 days YETI Holdings is expected to generate 2.08 times less return on investment than Xponential Fitness. But when comparing it to its historical volatility, YETI Holdings is 2.37 times less risky than Xponential Fitness. It trades about 0.21 of its potential returns per unit of risk. Xponential Fitness is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1,249 in Xponential Fitness on August 28, 2024 and sell it today you would earn a total of 321.00 from holding Xponential Fitness or generate 25.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
YETI Holdings vs. Xponential Fitness
Performance |
| Timeline |
| YETI Holdings |
| Xponential Fitness |
YETI Holdings and Xponential Fitness Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YETI Holdings and Xponential Fitness
The main advantage of trading using opposite YETI Holdings and Xponential Fitness positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YETI Holdings position performs unexpectedly, Xponential Fitness 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 Xponential Fitness will offset losses from the drop in Xponential Fitness' long position.| YETI Holdings vs. Acushnet Holdings Corp | YETI Holdings vs. Bowlero Corp | YETI Holdings vs. Madison Square Garden | YETI Holdings vs. Callaway Golf |
| 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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