Correlation Between Purecycle Technologies and First Advantage

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

By analyzing existing cross correlation between Purecycle Technologies Holdings and First Advantage Corp, you can compare the effects of market volatilities on Purecycle Technologies and First Advantage 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 Purecycle Technologies with a short position of First Advantage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Purecycle Technologies and First Advantage.

Diversification Opportunities for Purecycle Technologies and First Advantage

0.75

Correlation Coefficient

Purecycle Technologies  First Advantage

Poor diversification

The 3 months correlation between Purecycle and First is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Purecycle Technologies Holding and First Advantage Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Advantage Corp and Purecycle Technologies 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 Purecycle Technologies Holdings are associated (or correlated) with First Advantage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Advantage Corp has no effect on the direction of Purecycle Technologies i.e., Purecycle Technologies and First Advantage go up and down completely randomly.

Pair Corralation between Purecycle Technologies and First Advantage

Considering the 90-day investment horizon Purecycle Technologies Holdings is expected to under-perform the First Advantage. In addition to that, Purecycle Technologies is 1.73 times more volatile than First Advantage Corp. It trades about -0.15 of its total potential returns per unit of risk. First Advantage Corp is currently generating about -0.08 per unit of volatility. If you would invest  1,590  in First Advantage Corp on August 30, 2025 and sell it today you would lose (208.00) from holding First Advantage Corp or give up 13.08% of portfolio value over 90 days.

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

Purecycle Technologies Holding  vs.  First Advantage Corp

Purecycle Technologies

Risk-Adjusted Performance

Weakest

Over the last 90 days Purecycle Technologies Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's fundamental indicators remain comparatively stable which may send shares a bit higher in December 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

First Advantage Corp

Risk-Adjusted Performance

Weakest

Over the last 90 days First Advantage Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Purecycle Technologies and First Advantage

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

The idea behind Purecycle Technologies Holdings and First Advantage 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.