Correlation Between Biglari Holdings and Joint Stock
Can any of the company-specific risk be diversified away by investing in both Biglari Holdings and Joint Stock 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 Joint Stock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Biglari Holdings and Joint Stock, you can compare the effects of market volatilities on Biglari Holdings and Joint Stock 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 Joint Stock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biglari Holdings and Joint Stock.
Diversification Opportunities for Biglari Holdings and Joint Stock
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Biglari and Joint is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Biglari Holdings and Joint Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Joint Stock 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 Joint Stock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Joint Stock has no effect on the direction of Biglari Holdings i.e., Biglari Holdings and Joint Stock go up and down completely randomly.
Pair Corralation between Biglari Holdings and Joint Stock
Allowing for the 90-day total investment horizon Biglari Holdings is expected to generate 0.9 times more return on investment than Joint Stock. However, Biglari Holdings is 1.11 times less risky than Joint Stock. It trades about 0.05 of its potential returns per unit of risk. Joint Stock is currently generating about 0.03 per unit of risk. If you would invest 17,776 in Biglari Holdings on September 1, 2024 and sell it today you would earn a total of 3,267 from holding Biglari Holdings or generate 18.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Biglari Holdings vs. Joint Stock
Performance |
| Timeline |
| Biglari Holdings |
| Joint Stock |
Biglari Holdings and Joint Stock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Biglari Holdings and Joint Stock
The main advantage of trading using opposite Biglari Holdings and Joint Stock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biglari Holdings position performs unexpectedly, Joint Stock 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 Joint Stock will offset losses from the drop in Joint Stock's long position.| Biglari Holdings vs. Cannae Holdings | Biglari Holdings vs. BJs Restaurants | Biglari Holdings vs. Ark Restaurants Corp | Biglari Holdings vs. Noble Romans |
| Joint Stock vs. Grocery Outlet Holding | Joint Stock vs. NH Foods Ltd | Joint Stock vs. Natural Alternatives International | Joint Stock vs. Tyson Foods |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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