Correlation Between Cheche Group and Cracker Barrel

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

By analyzing existing cross correlation between Cheche Group Class and Cracker Barrel Old, you can compare the effects of market volatilities on Cheche Group and Cracker Barrel 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 Cheche Group with a short position of Cracker Barrel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cheche Group and Cracker Barrel.

Diversification Opportunities for Cheche Group and Cracker Barrel

0.33

Correlation Coefficient

Cheche Group  Cracker Barrel

Weak diversification

The 3 months correlation between Cheche and Cracker is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Cheche Group Class and Cracker Barrel Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cracker Barrel Old and Cheche Group 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 Cheche Group Class are associated (or correlated) with Cracker Barrel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cracker Barrel Old has no effect on the direction of Cheche Group i.e., Cheche Group and Cracker Barrel go up and down completely randomly.

Pair Corralation between Cheche Group and Cracker Barrel

Considering the 90-day investment horizon Cheche Group is expected to generate 1.78 times less return on investment than Cracker Barrel. In addition to that, Cheche Group is 1.18 times more volatile than Cracker Barrel Old. It trades about 0.08 of its total potential returns per unit of risk. Cracker Barrel Old is currently generating about 0.17 per unit of volatility. If you would invest  5,204  in Cracker Barrel Old on October 11, 2024 and sell it today you would earn a total of  524.00  from holding Cracker Barrel Old or generate 10.07% return on investment over 90 days.

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

Cheche Group Class  vs.  Cracker Barrel Old

Cheche Group Class

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Cheche Group Class are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady fundamental indicators, Cheche Group may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Cracker Barrel Old

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Cracker Barrel Old are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite quite uncertain basic indicators, Cracker Barrel disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Cheche Group and Cracker Barrel

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

The idea behind Cheche Group Class and Cracker Barrel Old 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.