Correlation Between FitLife Brands, and Old Republic

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Can any of the company-specific risk be diversified away by investing in both FitLife Brands, and Old Republic 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 Old Republic 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 Old Republic International, you can compare the effects of market volatilities on FitLife Brands, and Old Republic 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 Old Republic. Check out your portfolio center. Please also check ongoing floating volatility patterns of FitLife Brands, and Old Republic.

Diversification Opportunities for FitLife Brands, and Old Republic

0.1
  Correlation Coefficient

Average diversification

The 3 months correlation between FitLife and Old is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding FitLife Brands, Common and Old Republic International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Old Republic Interna 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 Old Republic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Old Republic Interna has no effect on the direction of FitLife Brands, i.e., FitLife Brands, and Old Republic go up and down completely randomly.

Pair Corralation between FitLife Brands, and Old Republic

Given the investment horizon of 90 days FitLife Brands, Common is expected to under-perform the Old Republic. In addition to that, FitLife Brands, is 1.91 times more volatile than Old Republic International. It trades about -0.03 of its total potential returns per unit of risk. Old Republic International is currently generating about 0.13 per unit of volatility. If you would invest  3,495  in Old Republic International on September 6, 2024 and sell it today you would earn a total of  325.00  from holding Old Republic International or generate 9.3% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

FitLife Brands, Common  vs.  Old Republic International

 Performance 
       Timeline  
FitLife Brands, Common 

Risk-Adjusted Performance

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Weak
 
Strong
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.
Old Republic Interna 

Risk-Adjusted Performance

10 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Old Republic International are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, Old Republic may actually be approaching a critical reversion point that can send shares even higher in January 2025.

FitLife Brands, and Old Republic Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with FitLife Brands, and Old Republic

The main advantage of trading using opposite FitLife Brands, and Old Republic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FitLife Brands, position performs unexpectedly, Old Republic 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 Old Republic will offset losses from the drop in Old Republic's long position.
The idea behind FitLife Brands, Common and Old Republic International 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.

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