Correlation Between Flanigans Enterprises and Ieh Corp
Can any of the company-specific risk be diversified away by investing in both Flanigans Enterprises and Ieh Corp 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 Flanigans Enterprises and Ieh Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Flanigans Enterprises and Ieh Corp, you can compare the effects of market volatilities on Flanigans Enterprises and Ieh Corp 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 Flanigans Enterprises with a short position of Ieh Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flanigans Enterprises and Ieh Corp.
Diversification Opportunities for Flanigans Enterprises and Ieh Corp
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Flanigans and Ieh is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Flanigans Enterprises and Ieh Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ieh Corp and Flanigans Enterprises 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 Flanigans Enterprises are associated (or correlated) with Ieh Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ieh Corp has no effect on the direction of Flanigans Enterprises i.e., Flanigans Enterprises and Ieh Corp go up and down completely randomly.
Pair Corralation between Flanigans Enterprises and Ieh Corp
Considering the 90-day investment horizon Flanigans Enterprises is expected to generate 10.12 times more return on investment than Ieh Corp. However, Flanigans Enterprises is 10.12 times more volatile than Ieh Corp. It trades about 0.04 of its potential returns per unit of risk. Ieh Corp is currently generating about 0.03 per unit of risk. If you would invest 2,894 in Flanigans Enterprises on August 25, 2024 and sell it today you would lose (410.00) from holding Flanigans Enterprises or give up 14.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.57% |
| Values | Daily Returns |
Flanigans Enterprises vs. Ieh Corp
Performance |
| Timeline |
| Flanigans Enterprises |
| Ieh Corp |
Flanigans Enterprises and Ieh Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Flanigans Enterprises and Ieh Corp
The main advantage of trading using opposite Flanigans Enterprises and Ieh Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Flanigans Enterprises position performs unexpectedly, Ieh Corp 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 Ieh Corp will offset losses from the drop in Ieh Corp's long position.| Flanigans Enterprises vs. FAT Brands | Flanigans Enterprises vs. Potbelly Co | Flanigans Enterprises vs. BJs Restaurants | Flanigans Enterprises vs. One Group Hospitality |
| Ieh Corp vs. LGL Group | Ieh Corp vs. Deswell Industries | Ieh Corp vs. M tron Industries | Ieh Corp vs. Micropac Industries |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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