Correlation Between Fox Factory and Niu Technologies

Can any of the company-specific risk be diversified away by investing in both Fox Factory and Niu Technologies 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 Niu Technologies 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 Niu Technologies, you can compare the effects of market volatilities on Fox Factory and Niu Technologies 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 Niu Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fox Factory and Niu Technologies.

Diversification Opportunities for Fox Factory and Niu Technologies

0.04

Correlation Coefficient

Fox Factory  Niu Technologies

Significant diversification

The 3 months correlation between Fox and Niu is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Fox Factory Holding and Niu Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Niu Technologies 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 Niu Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Niu Technologies has no effect on the direction of Fox Factory i.e., Fox Factory and Niu Technologies go up and down completely randomly.

Pair Corralation between Fox Factory and Niu Technologies

Given the investment horizon of 90 days Fox Factory Holding is expected to generate 0.66 times more return on investment than Niu Technologies. However, Fox Factory Holding is 1.51 times less risky than Niu Technologies. It trades about 0.21 of its potential returns per unit of risk. Niu Technologies is currently generating about 0.03 per unit of risk. If you would invest  2,032  in Fox Factory Holding on May 7, 2025 and sell it today you would earn a total of  953.00  from holding Fox Factory Holding or generate 46.9% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.39%
Values	Daily Returns

Fox Factory Holding  vs.  Niu Technologies

Fox Factory Holding

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Fox Factory Holding are ranked lower than 16 (%) 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.

Niu Technologies

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Niu Technologies are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak forward indicators, Niu Technologies may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Fox Factory and Niu Technologies

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

The idea behind Fox Factory Holding and Niu Technologies 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.