Correlation Between Xponential Fitness and Highway Holdings
Can any of the company-specific risk be diversified away by investing in both Xponential Fitness and Highway 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 Highway 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 Highway Holdings Limited, you can compare the effects of market volatilities on Xponential Fitness and Highway 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 Highway Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xponential Fitness and Highway Holdings.
Diversification Opportunities for Xponential Fitness and Highway Holdings
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Xponential and Highway is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Xponential Fitness and Highway Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Highway 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 Highway Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Highway Holdings has no effect on the direction of Xponential Fitness i.e., Xponential Fitness and Highway Holdings go up and down completely randomly.
Pair Corralation between Xponential Fitness and Highway Holdings
Given the investment horizon of 90 days Xponential Fitness is expected to generate 1.07 times more return on investment than Highway Holdings. However, Xponential Fitness is 1.07 times more volatile than Highway Holdings Limited. It trades about 0.05 of its potential returns per unit of risk. Highway Holdings Limited is currently generating about 0.03 per unit of risk. If you would invest 1,259 in Xponential Fitness on September 24, 2024 and sell it today you would earn a total of 124.00 from holding Xponential Fitness or generate 9.85% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Xponential Fitness vs. Highway Holdings Limited
Performance |
Timeline |
Xponential Fitness |
Highway Holdings |
Xponential Fitness and Highway Holdings Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Xponential Fitness and Highway Holdings
The main advantage of trading using opposite Xponential Fitness and Highway Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xponential Fitness position performs unexpectedly, Highway 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 Highway Holdings will offset losses from the drop in Highway Holdings' long position.Xponential Fitness vs. Planet Fitness | Xponential Fitness vs. Bowlero Corp | Xponential Fitness vs. JAKKS Pacific | Xponential Fitness vs. Acushnet Holdings Corp |
Highway Holdings vs. Insteel Industries | Highway Holdings vs. Carpenter Technology | Highway Holdings vs. Mueller Industries | Highway Holdings vs. Northwest Pipe |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
Share Portfolio Track or share privately all of your investments from the convenience of any device | |
Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
Performance Analysis Check effects of mean-variance optimization against your current asset allocation |