Correlation Between GEN Restaurant and 694308KE6

Can any of the company-specific risk be diversified away by investing in both GEN Restaurant and 694308KE6 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 694308KE6 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 PCG 495 08 JUN 25, you can compare the effects of market volatilities on GEN Restaurant and 694308KE6 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 694308KE6. Check out your portfolio center. Please also check ongoing floating volatility patterns of GEN Restaurant and 694308KE6.

Diversification Opportunities for GEN Restaurant and 694308KE6

-0.16

Correlation Coefficient

GEN Restaurant  694308KE6

Good diversification

The 3 months correlation between GEN and 694308KE6 is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding GEN Restaurant Group, and PCG 495 08 JUN 25 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PCG 495 08 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 694308KE6. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PCG 495 08 has no effect on the direction of GEN Restaurant i.e., GEN Restaurant and 694308KE6 go up and down completely randomly.

Pair Corralation between GEN Restaurant and 694308KE6

Given the investment horizon of 90 days GEN Restaurant Group, is expected to under-perform the 694308KE6. In addition to that, GEN Restaurant is 20.37 times more volatile than PCG 495 08 JUN 25. It trades about -0.06 of its total potential returns per unit of risk. PCG 495 08 JUN 25 is currently generating about 0.01 per unit of volatility. If you would invest  9,990  in PCG 495 08 JUN 25 on December 25, 2024 and sell it today you would earn a total of  8.00  from holding PCG 495 08 JUN 25 or generate 0.08% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

GEN Restaurant Group,  vs.  PCG 495 08 JUN 25

GEN Restaurant Group,

Risk-Adjusted Performance

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 fragile performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

PCG 495 08

Risk-Adjusted Performance

Very Weak

Over the last 90 days PCG 495 08 JUN 25 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 694308KE6 is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with GEN Restaurant and 694308KE6

The main advantage of trading using opposite GEN Restaurant and 694308KE6 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GEN Restaurant position performs unexpectedly, 694308KE6 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 694308KE6 will offset losses from the drop in 694308KE6's long position.

The idea behind GEN Restaurant Group, and PCG 495 08 JUN 25 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.