Correlation Between VARIOUS EATERIES and Hollywood Bowl
Can any of the company-specific risk be diversified away by investing in both VARIOUS EATERIES and Hollywood Bowl 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 VARIOUS EATERIES and Hollywood Bowl into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VARIOUS EATERIES LS and Hollywood Bowl Group, you can compare the effects of market volatilities on VARIOUS EATERIES and Hollywood Bowl 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 VARIOUS EATERIES with a short position of Hollywood Bowl. Check out your portfolio center. Please also check ongoing floating volatility patterns of VARIOUS EATERIES and Hollywood Bowl.
Diversification Opportunities for VARIOUS EATERIES and Hollywood Bowl
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between VARIOUS and Hollywood is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding VARIOUS EATERIES LS and Hollywood Bowl Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hollywood Bowl Group and VARIOUS EATERIES 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 VARIOUS EATERIES LS are associated (or correlated) with Hollywood Bowl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hollywood Bowl Group has no effect on the direction of VARIOUS EATERIES i.e., VARIOUS EATERIES and Hollywood Bowl go up and down completely randomly.
Pair Corralation between VARIOUS EATERIES and Hollywood Bowl
Assuming the 90 days horizon VARIOUS EATERIES LS is expected to under-perform the Hollywood Bowl. In addition to that, VARIOUS EATERIES is 1.19 times more volatile than Hollywood Bowl Group. It trades about -0.04 of its total potential returns per unit of risk. Hollywood Bowl Group is currently generating about 0.04 per unit of volatility. If you would invest 246.00 in Hollywood Bowl Group on November 5, 2024 and sell it today you would earn a total of 76.00 from holding Hollywood Bowl Group or generate 30.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
VARIOUS EATERIES LS vs. Hollywood Bowl Group
Performance |
| Timeline |
| VARIOUS EATERIES |
| Hollywood Bowl Group |
VARIOUS EATERIES and Hollywood Bowl Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VARIOUS EATERIES and Hollywood Bowl
The main advantage of trading using opposite VARIOUS EATERIES and Hollywood Bowl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VARIOUS EATERIES position performs unexpectedly, Hollywood Bowl 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 Hollywood Bowl will offset losses from the drop in Hollywood Bowl's long position.| VARIOUS EATERIES vs. JAPAN AIRLINES | VARIOUS EATERIES vs. Nok Airlines PCL | VARIOUS EATERIES vs. Cal Maine Foods | VARIOUS EATERIES vs. Singapore Airlines Limited |
| Hollywood Bowl vs. SLR Investment Corp | Hollywood Bowl vs. AGNC INVESTMENT | Hollywood Bowl vs. ITALIAN WINE BRANDS | Hollywood Bowl vs. BRIT AMER TOBACCO |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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