Correlation Between BJs Restaurants and International Consolidated
Can any of the company-specific risk be diversified away by investing in both BJs Restaurants and International Consolidated 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 International Consolidated into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BJs Restaurants and International Consolidated Airlines, you can compare the effects of market volatilities on BJs Restaurants and International Consolidated 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 International Consolidated. Check out your portfolio center. Please also check ongoing floating volatility patterns of BJs Restaurants and International Consolidated.
Diversification Opportunities for BJs Restaurants and International Consolidated
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between BJs and International is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding BJs Restaurants and International Consolidated Air in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Consolidated 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 International Consolidated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Consolidated has no effect on the direction of BJs Restaurants i.e., BJs Restaurants and International Consolidated go up and down completely randomly.
Pair Corralation between BJs Restaurants and International Consolidated
Given the investment horizon of 90 days BJs Restaurants is expected to generate 1.17 times less return on investment than International Consolidated. In addition to that, BJs Restaurants is 1.02 times more volatile than International Consolidated Airlines. It trades about 0.06 of its total potential returns per unit of risk. International Consolidated Airlines is currently generating about 0.07 per unit of volatility. If you would invest 759.00 in International Consolidated Airlines on October 23, 2024 and sell it today you would earn a total of 14.00 from holding International Consolidated Airlines or generate 1.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.74% |
| Values | Daily Returns |
BJs Restaurants vs. International Consolidated Air
Performance |
| Timeline |
| BJs Restaurants |
| International Consolidated |
BJs Restaurants and International Consolidated Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BJs Restaurants and International Consolidated
The main advantage of trading using opposite BJs Restaurants and International Consolidated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BJs Restaurants position performs unexpectedly, International Consolidated 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 International Consolidated will offset losses from the drop in International Consolidated'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 |
| International Consolidated vs. BIO Key International | International Consolidated vs. LogicMark | International Consolidated vs. Knightscope | International Consolidated vs. Guardforce AI Co |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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