Correlation Between Ballys Corp and BJs Restaurants
Can any of the company-specific risk be diversified away by investing in both Ballys Corp 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 Ballys Corp and BJs Restaurants into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ballys Corp and BJs Restaurants, you can compare the effects of market volatilities on Ballys Corp 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 Ballys Corp with a short position of BJs Restaurants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ballys Corp and BJs Restaurants.
Diversification Opportunities for Ballys Corp and BJs Restaurants
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Ballys and BJs is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Ballys Corp and BJs Restaurants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BJs Restaurants and Ballys Corp 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 Ballys Corp 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 Ballys Corp i.e., Ballys Corp and BJs Restaurants go up and down completely randomly.
Pair Corralation between Ballys Corp and BJs Restaurants
Given the investment horizon of 90 days Ballys Corp is expected to generate 0.11 times more return on investment than BJs Restaurants. However, Ballys Corp is 9.07 times less risky than BJs Restaurants. It trades about 0.21 of its potential returns per unit of risk. BJs Restaurants is currently generating about -0.06 per unit of risk. If you would invest 1,781 in Ballys Corp on October 12, 2024 and sell it today you would earn a total of 18.00 from holding Ballys Corp or generate 1.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ballys Corp vs. BJs Restaurants
Performance |
| Timeline |
| Ballys Corp |
| BJs Restaurants |
Ballys Corp and BJs Restaurants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ballys Corp and BJs Restaurants
The main advantage of trading using opposite Ballys Corp and BJs Restaurants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ballys Corp 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.| Ballys Corp vs. Monarch Casino Resort | Ballys Corp vs. Golden Entertainment | Ballys Corp vs. Century Casinos | Ballys Corp vs. Melco Resorts Entertainment |
| BJs Restaurants vs. Dine Brands Global | BJs Restaurants vs. Brinker International | BJs Restaurants vs. Bloomin Brands | BJs Restaurants 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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