Correlation Between FitLife Brands, and Comstock Holding

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

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

Diversification Opportunities for FitLife Brands, and Comstock Holding

-0.51

Correlation Coefficient

FitLife Brands,  Comstock Holding

Excellent diversification

The 3 months correlation between FitLife and Comstock is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding FitLife Brands, Common and Comstock Holding Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comstock Holding Com and FitLife Brands, 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 FitLife Brands, Common are associated (or correlated) with Comstock Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comstock Holding Com has no effect on the direction of FitLife Brands, i.e., FitLife Brands, and Comstock Holding go up and down completely randomly.

Pair Corralation between FitLife Brands, and Comstock Holding

Given the investment horizon of 90 days FitLife Brands, Common is expected to under-perform the Comstock Holding. But the stock apears to be less risky and, when comparing its historical volatility, FitLife Brands, Common is 2.29 times less risky than Comstock Holding. The stock trades about -0.01 of its potential returns per unit of risk. The Comstock Holding Companies is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  768.00  in Comstock Holding Companies on September 11, 2024 and sell it today you would earn a total of  114.00  from holding Comstock Holding Companies or generate 14.84% return on investment over 90 days.

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

FitLife Brands, Common  vs.  Comstock Holding Companies

FitLife Brands, Common

Risk-Adjusted Performance

0 of 100

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 nearly stable essential indicators, FitLife Brands, is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Comstock Holding Com

Risk-Adjusted Performance

5 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Comstock Holding Companies are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite fairly unsteady fundamental indicators, Comstock Holding demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with FitLife Brands, and Comstock Holding

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

The idea behind FitLife Brands, Common and Comstock Holding Companies 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.