Correlation Between Bagger Daves and Nathans Famous
Can any of the company-specific risk be diversified away by investing in both Bagger Daves and Nathans Famous 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 Bagger Daves and Nathans Famous into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bagger Daves Burger and Nathans Famous, you can compare the effects of market volatilities on Bagger Daves and Nathans Famous 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 Bagger Daves with a short position of Nathans Famous. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bagger Daves and Nathans Famous.
Diversification Opportunities for Bagger Daves and Nathans Famous
-0.9 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bagger and Nathans is -0.9. Overlapping area represents the amount of risk that can be diversified away by holding Bagger Daves Burger and Nathans Famous in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nathans Famous and Bagger Daves 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 Bagger Daves Burger are associated (or correlated) with Nathans Famous. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nathans Famous has no effect on the direction of Bagger Daves i.e., Bagger Daves and Nathans Famous go up and down completely randomly.
Pair Corralation between Bagger Daves and Nathans Famous
Given the investment horizon of 90 days Bagger Daves Burger is expected to under-perform the Nathans Famous. But the pink sheet apears to be less risky and, when comparing its historical volatility, Bagger Daves Burger is 1.2 times less risky than Nathans Famous. The pink sheet trades about -0.22 of its potential returns per unit of risk. The Nathans Famous is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 7,878 in Nathans Famous on December 28, 2024 and sell it today you would earn a total of 1,614 from holding Nathans Famous or generate 20.49% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 95.24% |
Values | Daily Returns |
Bagger Daves Burger vs. Nathans Famous
Performance |
Timeline |
Bagger Daves Burger |
Nathans Famous |
Bagger Daves and Nathans Famous Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Bagger Daves and Nathans Famous
The main advantage of trading using opposite Bagger Daves and Nathans Famous positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bagger Daves position performs unexpectedly, Nathans Famous 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 Nathans Famous will offset losses from the drop in Nathans Famous' long position.Bagger Daves vs. Alsea SAB de | Bagger Daves vs. Marstons PLC | Bagger Daves vs. Marstons PLC | Bagger Daves vs. Spot Coffee |
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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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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