Correlation Between BJs Restaurants and CureVac NV
Can any of the company-specific risk be diversified away by investing in both BJs Restaurants and CureVac NV 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 BJs Restaurants and CureVac NV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BJs Restaurants and CureVac NV, you can compare the effects of market volatilities on BJs Restaurants and CureVac NV 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 BJs Restaurants with a short position of CureVac NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of BJs Restaurants and CureVac NV.
Diversification Opportunities for BJs Restaurants and CureVac NV
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between BJs and CureVac is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding BJs Restaurants and CureVac NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CureVac NV and BJs Restaurants 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 BJs Restaurants are associated (or correlated) with CureVac NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CureVac NV has no effect on the direction of BJs Restaurants i.e., BJs Restaurants and CureVac NV go up and down completely randomly.
Pair Corralation between BJs Restaurants and CureVac NV
Given the investment horizon of 90 days BJs Restaurants is expected to under-perform the CureVac NV. But the stock apears to be less risky and, when comparing its historical volatility, BJs Restaurants is 3.37 times less risky than CureVac NV. The stock trades about -0.18 of its potential returns per unit of risk. The CureVac NV is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 310.00 in CureVac NV on October 16, 2024 and sell it today you would earn a total of 84.00 from holding CureVac NV or generate 27.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BJs Restaurants vs. CureVac NV
Performance |
| Timeline |
| BJs Restaurants |
| CureVac NV |
BJs Restaurants and CureVac NV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BJs Restaurants and CureVac NV
The main advantage of trading using opposite BJs Restaurants and CureVac NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BJs Restaurants position performs unexpectedly, CureVac NV 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 CureVac NV will offset losses from the drop in CureVac NV's long position.| BJs Restaurants vs. Dine Brands Global | BJs Restaurants vs. Brinker International | BJs Restaurants vs. Bloomin Brands | BJs Restaurants vs. The Cheesecake Factory |
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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