Correlation Between Biglari Holdings and First Republic
Can any of the company-specific risk be diversified away by investing in both Biglari Holdings and First Republic 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 Biglari Holdings and First Republic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Biglari Holdings and First Republic Bank, you can compare the effects of market volatilities on Biglari Holdings and First Republic 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 Biglari Holdings with a short position of First Republic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biglari Holdings and First Republic.
Diversification Opportunities for Biglari Holdings and First Republic
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Biglari and First is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Biglari Holdings and First Republic Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Republic Bank and Biglari Holdings 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 Biglari Holdings are associated (or correlated) with First Republic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Republic Bank has no effect on the direction of Biglari Holdings i.e., Biglari Holdings and First Republic go up and down completely randomly.
Pair Corralation between Biglari Holdings and First Republic
If you would invest 14,896 in Biglari Holdings on September 1, 2024 and sell it today you would earn a total of 6,147 from holding Biglari Holdings or generate 41.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 0.37% |
| Values | Daily Returns |
Biglari Holdings vs. First Republic Bank
Performance |
| Timeline |
| Biglari Holdings |
| First Republic Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Biglari Holdings and First Republic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Biglari Holdings and First Republic
The main advantage of trading using opposite Biglari Holdings and First Republic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biglari Holdings position performs unexpectedly, First Republic 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 First Republic will offset losses from the drop in First Republic's long position.| Biglari Holdings vs. Cannae Holdings | Biglari Holdings vs. BJs Restaurants | Biglari Holdings vs. Ark Restaurants Corp | Biglari Holdings vs. Noble Romans |
| First Republic vs. Royalty Management Holding | First Republic vs. Fidus Investment Corp | First Republic vs. Encore Capital Group | First Republic vs. Waste Management |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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