Correlation Between Dave Busters and Global Ship

Can any of the company-specific risk be diversified away by investing in both Dave Busters and Global Ship 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 Global Ship 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 Global Ship Lease, you can compare the effects of market volatilities on Dave Busters and Global Ship 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 Global Ship. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dave Busters and Global Ship.

Diversification Opportunities for Dave Busters and Global Ship

-0.29

Correlation Coefficient

Dave Busters  Global Ship

Very good diversification

The 3 months correlation between Dave and Global is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Dave Busters Entertainment and Global Ship Lease in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Ship Lease 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 Global Ship. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Ship Lease has no effect on the direction of Dave Busters i.e., Dave Busters and Global Ship go up and down completely randomly.

Pair Corralation between Dave Busters and Global Ship

Given the investment horizon of 90 days Dave Busters Entertainment is expected to under-perform the Global Ship. In addition to that, Dave Busters is 3.88 times more volatile than Global Ship Lease. It trades about 0.0 of its total potential returns per unit of risk. Global Ship Lease is currently generating about 0.07 per unit of volatility. If you would invest  2,043  in Global Ship Lease on September 21, 2024 and sell it today you would earn a total of  603.00  from holding Global Ship Lease or generate 29.52% return on investment over 90 days.

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

Dave Busters Entertainment  vs.  Global Ship Lease

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 weak performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Global Ship Lease

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Global Ship Lease are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong essential indicators, Global Ship is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Dave Busters and Global Ship

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

The idea behind Dave Busters Entertainment and Global Ship Lease 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.