Correlation Between BJs Restaurants and Triton International
Can any of the company-specific risk be diversified away by investing in both BJs Restaurants and Triton International 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 Triton International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BJs Restaurants and Triton International Limited, you can compare the effects of market volatilities on BJs Restaurants and Triton International 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 Triton International. Check out your portfolio center. Please also check ongoing floating volatility patterns of BJs Restaurants and Triton International.
Diversification Opportunities for BJs Restaurants and Triton International
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between BJs and Triton is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding BJs Restaurants and Triton International Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Triton International 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 Triton International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Triton International has no effect on the direction of BJs Restaurants i.e., BJs Restaurants and Triton International go up and down completely randomly.
Pair Corralation between BJs Restaurants and Triton International
Given the investment horizon of 90 days BJs Restaurants is expected to generate 3.14 times more return on investment than Triton International. However, BJs Restaurants is 3.14 times more volatile than Triton International Limited. It trades about 0.02 of its potential returns per unit of risk. Triton International Limited is currently generating about 0.06 per unit of risk. If you would invest 3,523 in BJs Restaurants on September 12, 2024 and sell it today you would earn a total of 147.00 from holding BJs Restaurants or generate 4.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BJs Restaurants vs. Triton International Limited
Performance |
| Timeline |
| BJs Restaurants |
| Triton International |
BJs Restaurants and Triton International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BJs Restaurants and Triton International
The main advantage of trading using opposite BJs Restaurants and Triton International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BJs Restaurants position performs unexpectedly, Triton International 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 Triton International will offset losses from the drop in Triton International's long position.| BJs Restaurants vs. Noble Romans | BJs Restaurants vs. Good Times Restaurants | BJs Restaurants vs. Flanigans Enterprises | BJs Restaurants vs. FAT Brands |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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