Correlation Between Ark Restaurants and SUMIBK

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

By analyzing existing cross correlation between Ark Restaurants Corp and SUMIBK 5766 13 JAN 33, you can compare the effects of market volatilities on Ark Restaurants and SUMIBK 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 Ark Restaurants with a short position of SUMIBK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ark Restaurants and SUMIBK.

Diversification Opportunities for Ark Restaurants and SUMIBK

-0.43

Correlation Coefficient

Ark Restaurants  SUMIBK

Very good diversification

The 3 months correlation between Ark and SUMIBK is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Ark Restaurants Corp and SUMIBK 5766 13 JAN 33 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SUMIBK 5766 13 and Ark Restaurants 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 Ark Restaurants Corp are associated (or correlated) with SUMIBK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SUMIBK 5766 13 has no effect on the direction of Ark Restaurants i.e., Ark Restaurants and SUMIBK go up and down completely randomly.

Pair Corralation between Ark Restaurants and SUMIBK

Given the investment horizon of 90 days Ark Restaurants Corp is expected to under-perform the SUMIBK. In addition to that, Ark Restaurants is 12.07 times more volatile than SUMIBK 5766 13 JAN 33. It trades about -0.03 of its total potential returns per unit of risk. SUMIBK 5766 13 JAN 33 is currently generating about 0.02 per unit of volatility. If you would invest  10,321  in SUMIBK 5766 13 JAN 33 on December 29, 2024 and sell it today you would earn a total of  41.00  from holding SUMIBK 5766 13 JAN 33 or generate 0.4% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	83.61%
Values	Daily Returns

Ark Restaurants Corp  vs.  SUMIBK 5766 13 JAN 33

Ark Restaurants Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ark Restaurants Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest inconsistent performance, the Stock's forward-looking signals remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

SUMIBK 5766 13

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SUMIBK 5766 13 JAN 33 are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, SUMIBK is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Ark Restaurants and SUMIBK

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

The idea behind Ark Restaurants Corp and SUMIBK 5766 13 JAN 33 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.