Correlation Between Fresenius and Joint Corp

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

By analyzing existing cross correlation between Fresenius SE Co and The Joint Corp, you can compare the effects of market volatilities on Fresenius and Joint Corp 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 Fresenius with a short position of Joint Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fresenius and Joint Corp.

Diversification Opportunities for Fresenius and Joint Corp

0.74

Correlation Coefficient

Fresenius  Joint Corp

Poor diversification

The 3 months correlation between Fresenius and Joint is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Fresenius SE Co and The Joint Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Joint Corp and Fresenius 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 Fresenius SE Co are associated (or correlated) with Joint Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Joint Corp has no effect on the direction of Fresenius i.e., Fresenius and Joint Corp go up and down completely randomly.

Pair Corralation between Fresenius and Joint Corp

Assuming the 90 days horizon Fresenius is expected to generate 7.03 times less return on investment than Joint Corp. But when comparing it to its historical volatility, Fresenius SE Co is 2.58 times less risky than Joint Corp. It trades about 0.02 of its potential returns per unit of risk. The Joint Corp is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  985.00  in The Joint Corp on May 6, 2025 and sell it today you would earn a total of  108.00  from holding The Joint Corp or generate 10.96% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.41%
Values	Daily Returns

Fresenius SE Co  vs.  The Joint Corp

Fresenius SE

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Fresenius SE Co are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Fresenius is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Joint Corp

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in The Joint Corp are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent basic indicators, Joint Corp unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Fresenius and Joint Corp

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

The idea behind Fresenius SE Co and The Joint Corp 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.