Correlation Between Amer Sports, and Burgerfi International

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

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

Diversification Opportunities for Amer Sports, and Burgerfi International

-0.21

Correlation Coefficient

Amer Sports,  Burgerfi International

Very good diversification

The 3 months correlation between Amer and Burgerfi is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Amer Sports, and Burgerfi International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Burgerfi International and Amer Sports, 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 Amer Sports, are associated (or correlated) with Burgerfi International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Burgerfi International has no effect on the direction of Amer Sports, i.e., Amer Sports, and Burgerfi International go up and down completely randomly.

Pair Corralation between Amer Sports, and Burgerfi International

If you would invest  2,765  in Amer Sports, on October 16, 2024 and sell it today you would earn a total of  145.00  from holding Amer Sports, or generate 5.24% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	5.56%
Values	Daily Returns

Amer Sports,  vs.  Burgerfi International

Amer Sports,

Risk-Adjusted Performance

20 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Amer Sports, are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, Amer Sports, unveiled solid returns over the last few months and may actually be approaching a breakup point.

Burgerfi International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Burgerfi International has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong technical and fundamental indicators, Burgerfi International is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Amer Sports, and Burgerfi International

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

The idea behind Amer Sports, and Burgerfi International 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.