Correlation Between MEDIFAST INC and IMedia Brands
Can any of the company-specific risk be diversified away by investing in both MEDIFAST INC and IMedia Brands 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 MEDIFAST INC and IMedia Brands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MEDIFAST INC and IMedia Brands, you can compare the effects of market volatilities on MEDIFAST INC and IMedia Brands 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 MEDIFAST INC with a short position of IMedia Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of MEDIFAST INC and IMedia Brands.
Diversification Opportunities for MEDIFAST INC and IMedia Brands
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between MEDIFAST and IMedia is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding MEDIFAST INC and IMedia Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IMedia Brands and MEDIFAST INC 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 MEDIFAST INC are associated (or correlated) with IMedia Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IMedia Brands has no effect on the direction of MEDIFAST INC i.e., MEDIFAST INC and IMedia Brands go up and down completely randomly.
Pair Corralation between MEDIFAST INC and IMedia Brands
If you would invest 0.04 in IMedia Brands on January 25, 2024 and sell it today you would earn a total of 0.00 from holding IMedia Brands or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 4.55% |
| Values | Daily Returns |
MEDIFAST INC vs. IMedia Brands
Performance |
| Timeline |
| MEDIFAST INC |
| IMedia Brands |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
MEDIFAST INC and IMedia Brands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MEDIFAST INC and IMedia Brands
The main advantage of trading using opposite MEDIFAST INC and IMedia Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MEDIFAST INC position performs unexpectedly, IMedia Brands 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 IMedia Brands will offset losses from the drop in IMedia Brands' long position.| MEDIFAST INC vs. Rollins | MEDIFAST INC vs. Carriage Services | MEDIFAST INC vs. Service International | MEDIFAST INC vs. Bright Horizons Family |
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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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