Correlation Between Dine Brands and Oak Woods
Can any of the company-specific risk be diversified away by investing in both Dine Brands and Oak Woods 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 Dine Brands and Oak Woods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dine Brands Global and Oak Woods Acquisition, you can compare the effects of market volatilities on Dine Brands and Oak Woods 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 Dine Brands with a short position of Oak Woods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dine Brands and Oak Woods.
Diversification Opportunities for Dine Brands and Oak Woods
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Dine and Oak is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Dine Brands Global and Oak Woods Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oak Woods Acquisition and Dine Brands 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 Dine Brands Global are associated (or correlated) with Oak Woods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oak Woods Acquisition has no effect on the direction of Dine Brands i.e., Dine Brands and Oak Woods go up and down completely randomly.
Pair Corralation between Dine Brands and Oak Woods
Considering the 90-day investment horizon Dine Brands Global is expected to under-perform the Oak Woods. In addition to that, Dine Brands is 6.3 times more volatile than Oak Woods Acquisition. It trades about -0.1 of its total potential returns per unit of risk. Oak Woods Acquisition is currently generating about 0.02 per unit of volatility. If you would invest 1,144 in Oak Woods Acquisition on December 26, 2024 and sell it today you would earn a total of 7.00 from holding Oak Woods Acquisition or generate 0.61% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Dine Brands Global vs. Oak Woods Acquisition
Performance |
Timeline |
Dine Brands Global |
Oak Woods Acquisition |
Dine Brands and Oak Woods Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Dine Brands and Oak Woods
The main advantage of trading using opposite Dine Brands and Oak Woods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dine Brands position performs unexpectedly, Oak Woods 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 Oak Woods will offset losses from the drop in Oak Woods' long position.Dine Brands vs. Dominos Pizza Common | Dine Brands vs. Yum Brands | Dine Brands vs. The Wendys Co | Dine Brands vs. Wingstop |
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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