Correlation Between Xponential Fitness and Chimerix

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

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

Diversification Opportunities for Xponential Fitness and Chimerix

0.37

Correlation Coefficient

Xponential Fitness  Chimerix

Weak diversification

The 3 months correlation between Xponential and Chimerix is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Xponential Fitness and Chimerix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chimerix and Xponential Fitness 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 Xponential Fitness are associated (or correlated) with Chimerix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chimerix has no effect on the direction of Xponential Fitness i.e., Xponential Fitness and Chimerix go up and down completely randomly.

Pair Corralation between Xponential Fitness and Chimerix

Given the investment horizon of 90 days Xponential Fitness is expected to generate 1.57 times more return on investment than Chimerix. However, Xponential Fitness is 1.57 times more volatile than Chimerix. It trades about 0.01 of its potential returns per unit of risk. Chimerix is currently generating about -0.04 per unit of risk. If you would invest  2,149  in Xponential Fitness on August 19, 2024 and sell it today you would lose (653.00) from holding Xponential Fitness or give up 30.39% of portfolio value over 90 days.

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

Xponential Fitness  vs.  Chimerix

Xponential Fitness

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Xponential Fitness are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Xponential Fitness may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Chimerix

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Chimerix has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in December 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Xponential Fitness and Chimerix

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

The idea behind Xponential Fitness and Chimerix 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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.