Correlation Between JJill and Xponential Fitness

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

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

Diversification Opportunities for JJill and Xponential Fitness

0.71

Correlation Coefficient

JJill  Xponential Fitness

Poor diversification

The 3 months correlation between JJill and Xponential is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding JJill Inc and Xponential Fitness in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xponential Fitness and JJill 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 JJill Inc are associated (or correlated) with Xponential Fitness. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xponential Fitness has no effect on the direction of JJill i.e., JJill and Xponential Fitness go up and down completely randomly.

Pair Corralation between JJill and Xponential Fitness

Given the investment horizon of 90 days JJill Inc is expected to generate 0.53 times more return on investment than Xponential Fitness. However, JJill Inc is 1.89 times less risky than Xponential Fitness. It trades about 0.03 of its potential returns per unit of risk. Xponential Fitness is currently generating about 0.01 per unit of risk. If you would invest  2,325  in JJill Inc on September 12, 2024 and sell it today you would earn a total of  454.00  from holding JJill Inc or generate 19.53% return on investment over 90 days.

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

JJill Inc  vs.  Xponential Fitness

JJill Inc

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in JJill Inc are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite quite unfluctuating essential indicators, JJill may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Xponential Fitness

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Xponential Fitness are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Xponential Fitness may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with JJill and Xponential Fitness

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

The idea behind JJill Inc and Xponential Fitness 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.