Correlation Between ANTA SPORTS and Freshpet

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

By analyzing existing cross correlation between ANTA SPORTS PRODUCT and Freshpet, you can compare the effects of market volatilities on ANTA SPORTS and Freshpet 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 ANTA SPORTS with a short position of Freshpet. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANTA SPORTS and Freshpet.

Diversification Opportunities for ANTA SPORTS and Freshpet

-0.63

Correlation Coefficient

ANTA SPORTS  Freshpet

Excellent diversification

The 3 months correlation between ANTA and Freshpet is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding ANTA SPORTS PRODUCT and Freshpet in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Freshpet and ANTA SPORTS 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 ANTA SPORTS PRODUCT are associated (or correlated) with Freshpet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Freshpet has no effect on the direction of ANTA SPORTS i.e., ANTA SPORTS and Freshpet go up and down completely randomly.

Pair Corralation between ANTA SPORTS and Freshpet

Assuming the 90 days trading horizon ANTA SPORTS PRODUCT is expected to under-perform the Freshpet. In addition to that, ANTA SPORTS is 1.48 times more volatile than Freshpet. It trades about -0.06 of its total potential returns per unit of risk. Freshpet is currently generating about 0.02 per unit of volatility. If you would invest  14,190  in Freshpet on October 7, 2024 and sell it today you would earn a total of  85.00  from holding Freshpet or generate 0.6% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

ANTA SPORTS PRODUCT  vs.  Freshpet

ANTA SPORTS PRODUCT

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ANTA SPORTS PRODUCT has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in February 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Freshpet

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Freshpet are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Freshpet may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with ANTA SPORTS and Freshpet

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

The idea behind ANTA SPORTS PRODUCT and Freshpet 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.