Correlation Between Ark Restaurants and Jack In
Can any of the company-specific risk be diversified away by investing in both Ark Restaurants and Jack In 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 Ark Restaurants and Jack In into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ark Restaurants Corp and Jack In The, you can compare the effects of market volatilities on Ark Restaurants and Jack In 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 Ark Restaurants with a short position of Jack In. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ark Restaurants and Jack In.
Diversification Opportunities for Ark Restaurants and Jack In
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Ark and Jack is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Ark Restaurants Corp and Jack In The in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jack In and Ark Restaurants 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 Ark Restaurants Corp are associated (or correlated) with Jack In. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jack In has no effect on the direction of Ark Restaurants i.e., Ark Restaurants and Jack In go up and down completely randomly.
Pair Corralation between Ark Restaurants and Jack In
Given the investment horizon of 90 days Ark Restaurants Corp is expected to under-perform the Jack In. But the stock apears to be less risky and, when comparing its historical volatility, Ark Restaurants Corp is 1.57 times less risky than Jack In. The stock trades about -0.32 of its potential returns per unit of risk. The Jack In The is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest 5,053 in Jack In The on August 28, 2024 and sell it today you would lose (258.00) from holding Jack In The or give up 5.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ark Restaurants Corp vs. Jack In The
Performance |
| Timeline |
| Ark Restaurants Corp |
| Jack In |
Ark Restaurants and Jack In Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ark Restaurants and Jack In
The main advantage of trading using opposite Ark Restaurants and Jack In positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ark Restaurants position performs unexpectedly, Jack In 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 Jack In will offset losses from the drop in Jack In's long position.| Ark Restaurants vs. Nathans Famous | Ark Restaurants vs. Flanigans Enterprises | Ark Restaurants vs. Good Times Restaurants | Ark Restaurants vs. Auburn National Bancorporation |
| Jack In vs. Dine Brands Global | Jack In vs. Bloomin Brands | Jack In vs. BJs Restaurants | Jack In vs. The Cheesecake Factory |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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