Correlation Between Dine Brands and SUMIBK

Can any of the company-specific risk be diversified away by investing in both Dine Brands 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 Dine Brands and SUMIBK 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 SUMIBK 5766 13 JAN 33, you can compare the effects of market volatilities on Dine Brands 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 Dine Brands with a short position of SUMIBK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dine Brands and SUMIBK.

Diversification Opportunities for Dine Brands and SUMIBK

-0.42

Correlation Coefficient

Dine Brands  SUMIBK

Very good diversification

The 3 months correlation between Dine and SUMIBK is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Dine Brands Global 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 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 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 Dine Brands i.e., Dine Brands and SUMIBK go up and down completely randomly.

Pair Corralation between Dine Brands and SUMIBK

Considering the 90-day investment horizon Dine Brands Global is expected to generate 7.16 times more return on investment than SUMIBK. However, Dine Brands is 7.16 times more volatile than SUMIBK 5766 13 JAN 33. It trades about 0.08 of its potential returns per unit of risk. SUMIBK 5766 13 JAN 33 is currently generating about -0.15 per unit of risk. If you would invest  2,999  in Dine Brands Global on September 5, 2024 and sell it today you would earn a total of  459.00  from holding Dine Brands Global or generate 15.31% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	78.13%
Values	Daily Returns

Dine Brands Global  vs.  SUMIBK 5766 13 JAN 33

Dine Brands Global

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Dine Brands Global are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very inconsistent forward indicators, Dine Brands displayed solid returns over the last few months and may actually be approaching a breakup point.

SUMIBK 5766 13

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SUMIBK 5766 13 JAN 33 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, SUMIBK is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Dine Brands and SUMIBK

The main advantage of trading using opposite Dine Brands and SUMIBK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dine Brands 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 Dine Brands Global 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.