Correlation Between ALBIS LEASING and BJs Restaurants
Can any of the company-specific risk be diversified away by investing in both ALBIS LEASING and BJs Restaurants 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 ALBIS LEASING and BJs Restaurants into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ALBIS LEASING AG and BJs Restaurants, you can compare the effects of market volatilities on ALBIS LEASING and BJs Restaurants 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 ALBIS LEASING with a short position of BJs Restaurants. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALBIS LEASING and BJs Restaurants.
Diversification Opportunities for ALBIS LEASING and BJs Restaurants
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ALBIS and BJs is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding ALBIS LEASING AG and BJs Restaurants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BJs Restaurants and ALBIS LEASING 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 ALBIS LEASING AG are associated (or correlated) with BJs Restaurants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BJs Restaurants has no effect on the direction of ALBIS LEASING i.e., ALBIS LEASING and BJs Restaurants go up and down completely randomly.
Pair Corralation between ALBIS LEASING and BJs Restaurants
Assuming the 90 days trading horizon ALBIS LEASING is expected to generate 1.3 times less return on investment than BJs Restaurants. But when comparing it to its historical volatility, ALBIS LEASING AG is 3.06 times less risky than BJs Restaurants. It trades about 0.06 of its potential returns per unit of risk. BJs Restaurants is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 2,880 in BJs Restaurants on August 27, 2024 and sell it today you would earn a total of 480.00 from holding BJs Restaurants or generate 16.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
ALBIS LEASING AG vs. BJs Restaurants
Performance |
| Timeline |
| ALBIS LEASING AG |
| BJs Restaurants |
ALBIS LEASING and BJs Restaurants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ALBIS LEASING and BJs Restaurants
The main advantage of trading using opposite ALBIS LEASING and BJs Restaurants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ALBIS LEASING position performs unexpectedly, BJs Restaurants 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 BJs Restaurants will offset losses from the drop in BJs Restaurants' long position.| ALBIS LEASING vs. IDP EDUCATION LTD | ALBIS LEASING vs. Adtalem Global Education | ALBIS LEASING vs. Luckin Coffee | ALBIS LEASING vs. DeVry Education Group |
| BJs Restaurants vs. Apple Inc | BJs Restaurants vs. Apple Inc | BJs Restaurants vs. Apple Inc | BJs Restaurants vs. Apple Inc |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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