Correlation Between Fox Factory and AYRO

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

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

Diversification Opportunities for Fox Factory and AYRO

-0.21

Correlation Coefficient

Fox Factory  AYRO

Very good diversification

The 3 months correlation between Fox and AYRO is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Fox Factory Holding and AYRO Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AYRO Inc and Fox Factory 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 Fox Factory Holding are associated (or correlated) with AYRO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AYRO Inc has no effect on the direction of Fox Factory i.e., Fox Factory and AYRO go up and down completely randomly.

Pair Corralation between Fox Factory and AYRO

Given the investment horizon of 90 days Fox Factory Holding is expected to generate 0.7 times more return on investment than AYRO. However, Fox Factory Holding is 1.42 times less risky than AYRO. It trades about 0.18 of its potential returns per unit of risk. AYRO Inc is currently generating about 0.0 per unit of risk. If you would invest  2,103  in Fox Factory Holding on May 4, 2025 and sell it today you would earn a total of  828.00  from holding Fox Factory Holding or generate 39.37% return on investment over 90 days.

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

Fox Factory Holding  vs.  AYRO Inc

Fox Factory Holding

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Fox Factory Holding are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite nearly unfluctuating basic indicators, Fox Factory reported solid returns over the last few months and may actually be approaching a breakup point.

AYRO Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days AYRO Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, AYRO is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Fox Factory and AYRO

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

The idea behind Fox Factory Holding and AYRO Inc 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.