Correlation Between FlyExclusive, and RXO

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

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

Diversification Opportunities for FlyExclusive, and RXO

-0.72

Correlation Coefficient

FlyExclusive,  RXO

Pay attention - limited upside

The 3 months correlation between FlyExclusive, and RXO is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding flyExclusive, and RXO Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RXO Inc and FlyExclusive, 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 flyExclusive, are associated (or correlated) with RXO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RXO Inc has no effect on the direction of FlyExclusive, i.e., FlyExclusive, and RXO go up and down completely randomly.

Pair Corralation between FlyExclusive, and RXO

Given the investment horizon of 90 days flyExclusive, is expected to generate 1.59 times more return on investment than RXO. However, FlyExclusive, is 1.59 times more volatile than RXO Inc. It trades about 0.17 of its potential returns per unit of risk. RXO Inc is currently generating about -0.18 per unit of risk. If you would invest  219.00  in flyExclusive, on December 1, 2024 and sell it today you would earn a total of  120.00  from holding flyExclusive, or generate 54.79% return on investment over 90 days.

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

flyExclusive,  vs.  RXO Inc

flyExclusive,

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in flyExclusive, are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady basic indicators, FlyExclusive, showed solid returns over the last few months and may actually be approaching a breakup point.

RXO Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days RXO Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with FlyExclusive, and RXO

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

The idea behind flyExclusive, and RXO Inc 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.