Correlation Between WB Burgers and Church Crawford

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

By analyzing existing cross correlation between WB Burgers Asia and Church Crawford, you can compare the effects of market volatilities on WB Burgers and Church Crawford 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 WB Burgers with a short position of Church Crawford. Check out your portfolio center. Please also check ongoing floating volatility patterns of WB Burgers and Church Crawford.

Diversification Opportunities for WB Burgers and Church Crawford

0.0

Correlation Coefficient

WB Burgers  Church Crawford

Pay attention - limited upside

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

Pair Corralation between WB Burgers and Church Crawford

If you would invest  0.20  in Church Crawford on December 20, 2024 and sell it today you would earn a total of  0.23  from holding Church Crawford or generate 115.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

WB Burgers Asia  vs.  Church Crawford

WB Burgers Asia

Risk-Adjusted Performance

Very Weak

Over the last 90 days WB Burgers Asia has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental drivers, WB Burgers is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Church Crawford

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Church Crawford are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Church Crawford reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with WB Burgers and Church Crawford

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

The idea behind WB Burgers Asia and Church Crawford 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.