Correlation Between Allient and GEN Restaurant
Can any of the company-specific risk be diversified away by investing in both Allient and GEN Restaurant 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 Allient and GEN Restaurant into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Allient and GEN Restaurant Group,, you can compare the effects of market volatilities on Allient and GEN Restaurant 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 Allient with a short position of GEN Restaurant. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allient and GEN Restaurant.
Diversification Opportunities for Allient and GEN Restaurant
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Allient and GEN is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Allient and GEN Restaurant Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GEN Restaurant Group, and Allient 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 Allient are associated (or correlated) with GEN Restaurant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GEN Restaurant Group, has no effect on the direction of Allient i.e., Allient and GEN Restaurant go up and down completely randomly.
Pair Corralation between Allient and GEN Restaurant
Given the investment horizon of 90 days Allient is expected to generate 0.54 times more return on investment than GEN Restaurant. However, Allient is 1.86 times less risky than GEN Restaurant. It trades about 0.63 of its potential returns per unit of risk. GEN Restaurant Group, is currently generating about -0.04 per unit of risk. If you would invest 1,756 in Allient on August 30, 2024 and sell it today you would earn a total of 778.00 from holding Allient or generate 44.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Allient vs. GEN Restaurant Group,
Performance |
| Timeline |
| Allient |
| GEN Restaurant Group, |
Allient and GEN Restaurant Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allient and GEN Restaurant
The main advantage of trading using opposite Allient and GEN Restaurant positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allient position performs unexpectedly, GEN Restaurant 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 GEN Restaurant will offset losses from the drop in GEN Restaurant's long position.| Allient vs. Vicor | Allient vs. LSI Industries | Allient vs. Shenzhen Genvict Technologies | Allient vs. Topsec Technologies Group |
| GEN Restaurant vs. Allient | GEN Restaurant vs. NioCorp Developments Ltd | GEN Restaurant vs. Nextplat Corp | GEN Restaurant vs. Asure Software |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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