Correlation Between Story and Theta Fuel

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

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

Diversification Opportunities for Story and Theta Fuel

0.83

Correlation Coefficient

Story  Theta Fuel

Very poor diversification

The 3 months correlation between Story and Theta is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Story and Theta Fuel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Theta Fuel and Story 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 Story are associated (or correlated) with Theta Fuel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Theta Fuel has no effect on the direction of Story i.e., Story and Theta Fuel go up and down completely randomly.

Pair Corralation between Story and Theta Fuel

Assuming the 90 days horizon Story is expected to generate 2.03 times more return on investment than Theta Fuel. However, Story is 2.03 times more volatile than Theta Fuel. It trades about 0.08 of its potential returns per unit of risk. Theta Fuel is currently generating about 0.05 per unit of risk. If you would invest  402.00  in Story on April 24, 2025 and sell it today you would earn a total of  98.00  from holding Story or generate 24.38% return on investment over 90 days.

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

Story  vs.  Theta Fuel

Story

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Story are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Story exhibited solid returns over the last few months and may actually be approaching a breakup point.

Theta Fuel

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Theta Fuel are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Theta Fuel may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Story and Theta Fuel

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

The idea behind Story and Theta Fuel 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..