Correlation Between Impulse Fitness and Fountaine Pajo

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

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

Diversification Opportunities for Impulse Fitness and Fountaine Pajo

0.0

Correlation Coefficient

Impulse Fitness  Fountaine Pajo

Pay attention - limited upside

The 3 months correlation between Impulse and Fountaine is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Impulse Fitness Solutions and Fountaine Pajo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fountaine Pajo and Impulse Fitness 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 Impulse Fitness Solutions are associated (or correlated) with Fountaine Pajo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fountaine Pajo has no effect on the direction of Impulse Fitness i.e., Impulse Fitness and Fountaine Pajo go up and down completely randomly.

Pair Corralation between Impulse Fitness and Fountaine Pajo

If you would invest  700.00  in Impulse Fitness Solutions on December 27, 2024 and sell it today you would earn a total of  0.00  from holding Impulse Fitness Solutions or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Impulse Fitness Solutions  vs.  Fountaine Pajo

Impulse Fitness Solutions

Risk-Adjusted Performance

Very Weak

Over the last 90 days Impulse Fitness Solutions has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Impulse Fitness is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Fountaine Pajo

Risk-Adjusted Performance

Very Weak

Over the last 90 days Fountaine Pajo has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Fountaine Pajo is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Impulse Fitness and Fountaine Pajo

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

The idea behind Impulse Fitness Solutions and Fountaine Pajo 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.