Correlation Between Bagger Daves and Ark Restaurants
Can any of the company-specific risk be diversified away by investing in both Bagger Daves and Ark 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 Bagger Daves and Ark Restaurants into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bagger Daves Burger and Ark Restaurants Corp, you can compare the effects of market volatilities on Bagger Daves and Ark 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 Bagger Daves with a short position of Ark Restaurants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bagger Daves and Ark Restaurants.
Diversification Opportunities for Bagger Daves and Ark Restaurants
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bagger and Ark is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Bagger Daves Burger and Ark Restaurants Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ark Restaurants Corp and Bagger Daves 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 Bagger Daves Burger are associated (or correlated) with Ark Restaurants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ark Restaurants Corp has no effect on the direction of Bagger Daves i.e., Bagger Daves and Ark Restaurants go up and down completely randomly.
Pair Corralation between Bagger Daves and Ark Restaurants
Given the investment horizon of 90 days Bagger Daves Burger is expected to generate 2.95 times more return on investment than Ark Restaurants. However, Bagger Daves is 2.95 times more volatile than Ark Restaurants Corp. It trades about -0.07 of its potential returns per unit of risk. Ark Restaurants Corp is currently generating about -0.32 per unit of risk. If you would invest 7.71 in Bagger Daves Burger on August 28, 2024 and sell it today you would lose (0.71) from holding Bagger Daves Burger or give up 9.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bagger Daves Burger vs. Ark Restaurants Corp
Performance |
| Timeline |
| Bagger Daves Burger |
| Ark Restaurants Corp |
Bagger Daves and Ark Restaurants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bagger Daves and Ark Restaurants
The main advantage of trading using opposite Bagger Daves and Ark Restaurants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bagger Daves position performs unexpectedly, Ark 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 Ark Restaurants will offset losses from the drop in Ark Restaurants' long position.| Bagger Daves vs. Alsea SAB de | Bagger Daves vs. Marstons PLC | Bagger Daves vs. Marstons PLC | Bagger Daves vs. Spot Coffee |
| Ark Restaurants vs. Nathans Famous | Ark Restaurants vs. Flanigans Enterprises | Ark Restaurants vs. Good Times Restaurants | Ark Restaurants vs. Auburn National Bancorporation |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |