Correlation Between FitLife Brands, and 26442CAR5

Can any of the company-specific risk be diversified away by investing in both FitLife Brands, and 26442CAR5 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 26442CAR5 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 DUKE ENERGY CAROLINAS, you can compare the effects of market volatilities on FitLife Brands, and 26442CAR5 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 26442CAR5. Check out your portfolio center. Please also check ongoing floating volatility patterns of FitLife Brands, and 26442CAR5.

Diversification Opportunities for FitLife Brands, and 26442CAR5

-0.01

Correlation Coefficient

FitLife Brands,  26442CAR5

Good diversification

The 3 months correlation between FitLife and 26442CAR5 is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding FitLife Brands, Common and DUKE ENERGY CAROLINAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DUKE ENERGY CAROLINAS 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 26442CAR5. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DUKE ENERGY CAROLINAS has no effect on the direction of FitLife Brands, i.e., FitLife Brands, and 26442CAR5 go up and down completely randomly.

Pair Corralation between FitLife Brands, and 26442CAR5

Given the investment horizon of 90 days FitLife Brands, is expected to generate 64.8 times less return on investment than 26442CAR5. But when comparing it to its historical volatility, FitLife Brands, Common is 39.17 times less risky than 26442CAR5. It trades about 0.06 of its potential returns per unit of risk. DUKE ENERGY CAROLINAS is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  8,349  in DUKE ENERGY CAROLINAS on October 11, 2024 and sell it today you would lose (559.00) from holding DUKE ENERGY CAROLINAS or give up 6.7% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	55.67%
Values	Daily Returns

FitLife Brands, Common  vs.  DUKE ENERGY CAROLINAS

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.

DUKE ENERGY CAROLINAS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days DUKE ENERGY CAROLINAS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 26442CAR5 is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with FitLife Brands, and 26442CAR5

The main advantage of trading using opposite FitLife Brands, and 26442CAR5 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FitLife Brands, position performs unexpectedly, 26442CAR5 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 26442CAR5 will offset losses from the drop in 26442CAR5's long position.

The idea behind FitLife Brands, Common and DUKE ENERGY CAROLINAS 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.