Correlation Between Dave Busters and Aperture Health

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

By analyzing existing cross correlation between Dave Busters Entertainment and Aperture Health, you can compare the effects of market volatilities on Dave Busters and Aperture Health 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 Dave Busters with a short position of Aperture Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dave Busters and Aperture Health.

Diversification Opportunities for Dave Busters and Aperture Health

0.0

Correlation Coefficient

Dave Busters  Aperture Health

Pay attention - limited upside

The 3 months correlation between Dave and Aperture is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Dave Busters Entertainment and Aperture Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aperture Health and Dave Busters 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 Dave Busters Entertainment are associated (or correlated) with Aperture Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aperture Health has no effect on the direction of Dave Busters i.e., Dave Busters and Aperture Health go up and down completely randomly.

Pair Corralation between Dave Busters and Aperture Health

If you would invest  5.90  in Aperture Health on October 9, 2024 and sell it today you would earn a total of  0.00  from holding Aperture Health or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	95.12%
Values	Daily Returns

Dave Busters Entertainment  vs.  Aperture Health

Dave Busters Enterta

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Dave Busters Entertainment has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Dave Busters is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Aperture Health

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aperture Health has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Aperture Health is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Dave Busters and Aperture Health

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

The idea behind Dave Busters Entertainment and Aperture Health 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.