Correlation Between Madison Square and F45 Training

Can any of the company-specific risk be diversified away by investing in both Madison Square and F45 Training 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 Madison Square and F45 Training into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Madison Square Garden and F45 Training Holdings, you can compare the effects of market volatilities on Madison Square and F45 Training 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 Madison Square with a short position of F45 Training. Check out your portfolio center. Please also check ongoing floating volatility patterns of Madison Square and F45 Training.

Diversification Opportunities for Madison Square and F45 Training

0.0

Correlation Coefficient

Madison Square  F45 Training

Pay attention - limited upside

The 3 months correlation between Madison and F45 is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Madison Square Garden and F45 Training Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on F45 Training Holdings and Madison Square 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 Madison Square Garden are associated (or correlated) with F45 Training. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of F45 Training Holdings has no effect on the direction of Madison Square i.e., Madison Square and F45 Training go up and down completely randomly.

Pair Corralation between Madison Square and F45 Training

If you would invest (100.00) in F45 Training Holdings on December 28, 2024 and sell it today you would earn a total of  100.00  from holding F45 Training Holdings or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Madison Square Garden  vs.  F45 Training Holdings

Madison Square Garden

Risk-Adjusted Performance

Very Weak

Over the last 90 days Madison Square Garden has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Madison Square is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

F45 Training Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days F45 Training Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable essential indicators, F45 Training is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Madison Square and F45 Training

The main advantage of trading using opposite Madison Square and F45 Training positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Madison Square position performs unexpectedly, F45 Training 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 F45 Training will offset losses from the drop in F45 Training's long position.

The idea behind Madison Square Garden and F45 Training Holdings 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.