Correlation Between VARIOUS EATERIES and DELCATH SYS

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

By analyzing existing cross correlation between VARIOUS EATERIES LS and DELCATH SYS NEW, you can compare the effects of market volatilities on VARIOUS EATERIES and DELCATH SYS 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 VARIOUS EATERIES with a short position of DELCATH SYS. Check out your portfolio center. Please also check ongoing floating volatility patterns of VARIOUS EATERIES and DELCATH SYS.

Diversification Opportunities for VARIOUS EATERIES and DELCATH SYS

-0.54

Correlation Coefficient

VARIOUS EATERIES  DELCATH SYS

Excellent diversification

The 3 months correlation between VARIOUS and DELCATH is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding VARIOUS EATERIES LS and DELCATH SYS NEW in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DELCATH SYS NEW and VARIOUS EATERIES 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 VARIOUS EATERIES LS are associated (or correlated) with DELCATH SYS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DELCATH SYS NEW has no effect on the direction of VARIOUS EATERIES i.e., VARIOUS EATERIES and DELCATH SYS go up and down completely randomly.

Pair Corralation between VARIOUS EATERIES and DELCATH SYS

Assuming the 90 days horizon VARIOUS EATERIES LS is expected to under-perform the DELCATH SYS. But the stock apears to be less risky and, when comparing its historical volatility, VARIOUS EATERIES LS is 3.98 times less risky than DELCATH SYS. The stock trades about -0.24 of its potential returns per unit of risk. The DELCATH SYS NEW is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  1,100  in DELCATH SYS NEW on October 9, 2024 and sell it today you would earn a total of  100.00  from holding DELCATH SYS NEW or generate 9.09% return on investment over 90 days.

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

VARIOUS EATERIES LS  vs.  DELCATH SYS NEW

VARIOUS EATERIES

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days VARIOUS EATERIES LS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

DELCATH SYS NEW

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in DELCATH SYS NEW are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, DELCATH SYS reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with VARIOUS EATERIES and DELCATH SYS

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

The idea behind VARIOUS EATERIES LS and DELCATH SYS NEW 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.