Correlation Between Xponential Fitness and Lottery, Warrants

Can any of the company-specific risk be diversified away by investing in both Xponential Fitness and Lottery, Warrants 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 Lottery, Warrants into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Xponential Fitness and Lottery, Warrants, you can compare the effects of market volatilities on Xponential Fitness and Lottery, Warrants 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 Lottery, Warrants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xponential Fitness and Lottery, Warrants.

Diversification Opportunities for Xponential Fitness and Lottery, Warrants

-0.43

Correlation Coefficient

Xponential Fitness  Lottery, Warrants

Very good diversification

The 3 months correlation between Xponential and Lottery, is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Xponential Fitness and Lottery, Warrants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lottery, Warrants 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 Lottery, Warrants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lottery, Warrants has no effect on the direction of Xponential Fitness i.e., Xponential Fitness and Lottery, Warrants go up and down completely randomly.

Pair Corralation between Xponential Fitness and Lottery, Warrants

Given the investment horizon of 90 days Xponential Fitness is expected to under-perform the Lottery, Warrants. But the stock apears to be less risky and, when comparing its historical volatility, Xponential Fitness is 2.8 times less risky than Lottery, Warrants. The stock trades about 0.0 of its potential returns per unit of risk. The Lottery, Warrants is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  1.72  in Lottery, Warrants on September 30, 2024 and sell it today you would lose (0.58) from holding Lottery, Warrants or give up 33.72% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	97.99%
Values	Daily Returns

Xponential Fitness  vs.  Lottery, Warrants

Xponential Fitness

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Xponential Fitness are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Xponential Fitness may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Lottery, Warrants

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Lottery, Warrants are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Lottery, Warrants showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Xponential Fitness and Lottery, Warrants

The main advantage of trading using opposite Xponential Fitness and Lottery, Warrants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xponential Fitness position performs unexpectedly, Lottery, Warrants 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 Lottery, Warrants will offset losses from the drop in Lottery, Warrants' long position.

The idea behind Xponential Fitness and Lottery, Warrants pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.