Correlation Between United Airlines and Xponential Fitness

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

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

Diversification Opportunities for United Airlines and Xponential Fitness

0.87

Correlation Coefficient

United Airlines  Xponential Fitness

Very poor diversification

The 3 months correlation between United and Xponential is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding United Airlines Holdings and Xponential Fitness in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xponential Fitness and United Airlines 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 United Airlines Holdings 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 United Airlines i.e., United Airlines and Xponential Fitness go up and down completely randomly.

Pair Corralation between United Airlines and Xponential Fitness

Considering the 90-day investment horizon United Airlines Holdings is expected to under-perform the Xponential Fitness. But the stock apears to be less risky and, when comparing its historical volatility, United Airlines Holdings is 2.31 times less risky than Xponential Fitness. The stock trades about -0.14 of its potential returns per unit of risk. The Xponential Fitness is currently generating about -0.06 of returns per unit of risk over similar time horizon. If you would invest  1,295  in Xponential Fitness on December 22, 2024 and sell it today you would lose (429.00) from holding Xponential Fitness or give up 33.13% of portfolio value over 90 days.

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

United Airlines Holdings  vs.  Xponential Fitness

United Airlines Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days United Airlines Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Xponential Fitness

Risk-Adjusted Performance

Very Weak

Over the last 90 days Xponential Fitness has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with United Airlines and Xponential Fitness

The main advantage of trading using opposite United Airlines and Xponential Fitness positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Airlines 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 United Airlines Holdings 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 Commodity Directory module to find actively traded commodities issued by global exchanges.