Correlation Between CIFI Holdings and Darden Restaurants

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both CIFI Holdings and Darden Restaurants 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 CIFI Holdings and Darden Restaurants into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CIFI Holdings Co and Darden Restaurants, you can compare the effects of market volatilities on CIFI Holdings and Darden Restaurants 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 CIFI Holdings with a short position of Darden Restaurants. Check out your portfolio center. Please also check ongoing floating volatility patterns of CIFI Holdings and Darden Restaurants.

Diversification Opportunities for CIFI Holdings and Darden Restaurants

CIFIDardenDiversified AwayCIFIDardenDiversified Away100%
-0.79
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between CIFI and Darden is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding CIFI Holdings Co and Darden Restaurants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Darden Restaurants and CIFI Holdings 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 CIFI Holdings Co are associated (or correlated) with Darden Restaurants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Darden Restaurants has no effect on the direction of CIFI Holdings i.e., CIFI Holdings and Darden Restaurants go up and down completely randomly.

Pair Corralation between CIFI Holdings and Darden Restaurants

Assuming the 90 days horizon CIFI Holdings Co is expected to generate 7.77 times more return on investment than Darden Restaurants. However, CIFI Holdings is 7.77 times more volatile than Darden Restaurants. It trades about 0.03 of its potential returns per unit of risk. Darden Restaurants is currently generating about 0.05 per unit of risk. If you would invest  10.00  in CIFI Holdings Co on October 27, 2024 and sell it today you would lose (7.70) from holding CIFI Holdings Co or give up 77.0% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy99.8%
ValuesDaily Returns

CIFI Holdings Co  vs.  Darden Restaurants

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 -40-30-20-1001020
JavaScript chart by amCharts 3.21.156CI DDN
       Timeline  
CIFI Holdings 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days CIFI Holdings Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan0.0250.030.0350.040.045
Darden Restaurants 

Risk-Adjusted Performance

10 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Darden Restaurants are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, Darden Restaurants unveiled solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan145150155160165170175180

CIFI Holdings and Darden Restaurants Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-12.77-9.56-6.36-3.150.05062.986.029.0512.08 0.020.040.060.08
JavaScript chart by amCharts 3.21.156CI DDN
       Returns  

Pair Trading with CIFI Holdings and Darden Restaurants

The main advantage of trading using opposite CIFI Holdings and Darden Restaurants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CIFI Holdings position performs unexpectedly, Darden Restaurants 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 Darden Restaurants will offset losses from the drop in Darden Restaurants' long position.
The idea behind CIFI Holdings Co and Darden Restaurants 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.
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.

Other Complementary Tools

Equity Valuation
Check real value of public entities based on technical and fundamental data
Content Syndication
Quickly integrate customizable finance content to your own investment portal
Performance Analysis
Check effects of mean-variance optimization against your current asset allocation
Price Ceiling Movement
Calculate and plot Price Ceiling Movement for different equity instruments
Crypto Correlations
Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins