Correlation Between Asure Software and Shake Shack
Can any of the company-specific risk be diversified away by investing in both Asure Software and Shake Shack 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 Asure Software and Shake Shack into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asure Software and Shake Shack, you can compare the effects of market volatilities on Asure Software and Shake Shack 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 Asure Software with a short position of Shake Shack. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asure Software and Shake Shack.
Diversification Opportunities for Asure Software and Shake Shack
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Asure and Shake is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Asure Software and Shake Shack in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shake Shack and Asure Software 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 Asure Software are associated (or correlated) with Shake Shack. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shake Shack has no effect on the direction of Asure Software i.e., Asure Software and Shake Shack go up and down completely randomly.
Pair Corralation between Asure Software and Shake Shack
Given the investment horizon of 90 days Asure Software is expected to generate 1.98 times less return on investment than Shake Shack. In addition to that, Asure Software is 2.04 times more volatile than Shake Shack. It trades about 0.04 of its total potential returns per unit of risk. Shake Shack is currently generating about 0.16 per unit of volatility. If you would invest 12,247 in Shake Shack on August 31, 2024 and sell it today you would earn a total of 988.00 from holding Shake Shack or generate 8.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asure Software vs. Shake Shack
Performance |
| Timeline |
| Asure Software |
| Shake Shack |
Asure Software and Shake Shack Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asure Software and Shake Shack
The main advantage of trading using opposite Asure Software and Shake Shack positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asure Software position performs unexpectedly, Shake Shack 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 Shake Shack will offset losses from the drop in Shake Shack's long position.| Asure Software vs. Alkami Technology | Asure Software vs. Blackbaud | Asure Software vs. Enfusion | Asure Software vs. Clearwater Analytics Holdings |
| Shake Shack vs. Wingstop | Shake Shack vs. RLJ Lodging Trust | Shake Shack vs. Aquagold International | Shake Shack vs. Stepstone Group |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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