Correlation Between Ark Restaurants and Lottery, Warrants
Can any of the company-specific risk be diversified away by investing in both Ark Restaurants and Lottery, Warrants 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 Lottery, Warrants 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 Lottery, Warrants, you can compare the effects of market volatilities on Ark Restaurants and Lottery, Warrants 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 Lottery, Warrants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ark Restaurants and Lottery, Warrants.
Diversification Opportunities for Ark Restaurants and Lottery, Warrants
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ark and Lottery, is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Ark Restaurants Corp and Lottery, Warrants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lottery, Warrants 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 Lottery, Warrants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lottery, Warrants has no effect on the direction of Ark Restaurants i.e., Ark Restaurants and Lottery, Warrants go up and down completely randomly.
Pair Corralation between Ark Restaurants and Lottery, Warrants
Given the investment horizon of 90 days Ark Restaurants Corp is expected to under-perform the Lottery, Warrants. But the stock apears to be less risky and, when comparing its historical volatility, Ark Restaurants Corp is 8.75 times less risky than Lottery, Warrants. The stock trades about -0.3 of its potential returns per unit of risk. The Lottery, Warrants is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 0.75 in Lottery, Warrants on August 29, 2024 and sell it today you would earn a total of 0.33 from holding Lottery, Warrants or generate 44.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ark Restaurants Corp vs. Lottery, Warrants
Performance |
| Timeline |
| Ark Restaurants Corp |
| Lottery, Warrants |
Ark Restaurants and Lottery, Warrants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ark Restaurants and Lottery, Warrants
The main advantage of trading using opposite Ark Restaurants and Lottery, Warrants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ark Restaurants position performs unexpectedly, Lottery, Warrants 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 Lottery, Warrants will offset losses from the drop in Lottery, Warrants' long position.| Ark Restaurants vs. Nathans Famous | Ark Restaurants vs. Flanigans Enterprises | Ark Restaurants vs. Good Times Restaurants | Ark Restaurants vs. Auburn National Bancorporation |
| Lottery, Warrants vs. Lottery, Common Stock | Lottery, Warrants vs. Microvast Holdings | Lottery, Warrants vs. AEye Inc | Lottery, Warrants vs. Bakkt Holdings Warrant |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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