Correlation Between Butler National and FitLife Brands,

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

By analyzing existing cross correlation between Butler National Corp and FitLife Brands, Common, you can compare the effects of market volatilities on Butler National and FitLife Brands, 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 Butler National with a short position of FitLife Brands,. Check out your portfolio center. Please also check ongoing floating volatility patterns of Butler National and FitLife Brands,.

Diversification Opportunities for Butler National and FitLife Brands,

0.28

Correlation Coefficient

Butler National  FitLife Brands,

Modest diversification

The 3 months correlation between Butler and FitLife is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Butler National Corp and FitLife Brands, Common in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FitLife Brands, Common and Butler National 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 Butler National Corp are associated (or correlated) with FitLife Brands,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FitLife Brands, Common has no effect on the direction of Butler National i.e., Butler National and FitLife Brands, go up and down completely randomly.

Pair Corralation between Butler National and FitLife Brands,

Given the investment horizon of 90 days Butler National Corp is expected to generate 1.08 times more return on investment than FitLife Brands,. However, Butler National is 1.08 times more volatile than FitLife Brands, Common. It trades about 0.0 of its potential returns per unit of risk. FitLife Brands, Common is currently generating about -0.14 per unit of risk. If you would invest  181.00  in Butler National Corp on December 29, 2024 and sell it today you would lose (5.00) from holding Butler National Corp or give up 2.76% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.39%
Values	Daily Returns

Butler National Corp  vs.  FitLife Brands, Common

Butler National Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Butler National Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable forward-looking signals, Butler National is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

FitLife Brands, Common

Risk-Adjusted Performance

Very Weak

Over the last 90 days FitLife Brands, Common has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's essential indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Butler National and FitLife Brands,

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

The idea behind Butler National Corp and FitLife Brands, Common 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.

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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.