Correlation Between GEN Restaurant and NBCUNIVERSAL

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

By analyzing existing cross correlation between GEN Restaurant Group, and NBCUNIVERSAL MEDIA LLC, you can compare the effects of market volatilities on GEN Restaurant and NBCUNIVERSAL 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 GEN Restaurant with a short position of NBCUNIVERSAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of GEN Restaurant and NBCUNIVERSAL.

Diversification Opportunities for GEN Restaurant and NBCUNIVERSAL

0.44

Correlation Coefficient

GEN Restaurant  NBCUNIVERSAL

Very weak diversification

The 3 months correlation between GEN and NBCUNIVERSAL is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding GEN Restaurant Group, and NBCUNIVERSAL MEDIA LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NBCUNIVERSAL MEDIA LLC and GEN Restaurant 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 GEN Restaurant Group, are associated (or correlated) with NBCUNIVERSAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NBCUNIVERSAL MEDIA LLC has no effect on the direction of GEN Restaurant i.e., GEN Restaurant and NBCUNIVERSAL go up and down completely randomly.

Pair Corralation between GEN Restaurant and NBCUNIVERSAL

Given the investment horizon of 90 days GEN Restaurant Group, is expected to under-perform the NBCUNIVERSAL. In addition to that, GEN Restaurant is 1.17 times more volatile than NBCUNIVERSAL MEDIA LLC. It trades about -0.27 of its total potential returns per unit of risk. NBCUNIVERSAL MEDIA LLC is currently generating about 0.37 per unit of volatility. If you would invest  10,154  in NBCUNIVERSAL MEDIA LLC on October 25, 2024 and sell it today you would earn a total of  638.00  from holding NBCUNIVERSAL MEDIA LLC or generate 6.28% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	61.11%
Values	Daily Returns

GEN Restaurant Group,  vs.  NBCUNIVERSAL MEDIA LLC

GEN Restaurant Group,

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GEN Restaurant Group, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in February 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

NBCUNIVERSAL MEDIA LLC

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in NBCUNIVERSAL MEDIA LLC are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, NBCUNIVERSAL may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with GEN Restaurant and NBCUNIVERSAL

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

The idea behind GEN Restaurant Group, and NBCUNIVERSAL MEDIA LLC 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.