Correlation Between XS Financial and Consumer Portfolio

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

By analyzing existing cross correlation between XS Financial and Consumer Portfolio Services, you can compare the effects of market volatilities on XS Financial and Consumer Portfolio 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 XS Financial with a short position of Consumer Portfolio. Check out your portfolio center. Please also check ongoing floating volatility patterns of XS Financial and Consumer Portfolio.

Diversification Opportunities for XS Financial and Consumer Portfolio

0.0

Correlation Coefficient

XS Financial  Consumer Portfolio

Pay attention - limited upside

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

Pair Corralation between XS Financial and Consumer Portfolio

If you would invest (100.00) in XS Financial on December 26, 2024 and sell it today you would earn a total of  100.00  from holding XS Financial 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

XS Financial  vs.  Consumer Portfolio Services

XS Financial

Risk-Adjusted Performance

Very Weak

Over the last 90 days XS Financial has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable essential indicators, XS Financial is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Consumer Portfolio

Risk-Adjusted Performance

Very Weak

Over the last 90 days Consumer Portfolio Services has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with XS Financial and Consumer Portfolio

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

The idea behind XS Financial and Consumer Portfolio Services 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.