Correlation Between Bridgford Foods and GEN Restaurant
Can any of the company-specific risk be diversified away by investing in both Bridgford Foods and GEN Restaurant 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 Bridgford Foods and GEN Restaurant into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bridgford Foods and GEN Restaurant Group,, you can compare the effects of market volatilities on Bridgford Foods and GEN Restaurant 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 Bridgford Foods with a short position of GEN Restaurant. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bridgford Foods and GEN Restaurant.
Diversification Opportunities for Bridgford Foods and GEN Restaurant
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bridgford and GEN is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Bridgford Foods and GEN Restaurant Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GEN Restaurant Group, and Bridgford Foods 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 Bridgford Foods are associated (or correlated) with GEN Restaurant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GEN Restaurant Group, has no effect on the direction of Bridgford Foods i.e., Bridgford Foods and GEN Restaurant go up and down completely randomly.
Pair Corralation between Bridgford Foods and GEN Restaurant
Given the investment horizon of 90 days Bridgford Foods is expected to generate 0.9 times more return on investment than GEN Restaurant. However, Bridgford Foods is 1.11 times less risky than GEN Restaurant. It trades about 0.39 of its potential returns per unit of risk. GEN Restaurant Group, is currently generating about -0.16 per unit of risk. If you would invest 897.00 in Bridgford Foods on September 19, 2024 and sell it today you would earn a total of 181.00 from holding Bridgford Foods or generate 20.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bridgford Foods vs. GEN Restaurant Group,
Performance |
| Timeline |
| Bridgford Foods |
| GEN Restaurant Group, |
Bridgford Foods and GEN Restaurant Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bridgford Foods and GEN Restaurant
The main advantage of trading using opposite Bridgford Foods and GEN Restaurant positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bridgford Foods position performs unexpectedly, GEN Restaurant 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 GEN Restaurant will offset losses from the drop in GEN Restaurant's long position.| Bridgford Foods vs. J J Snack | Bridgford Foods vs. Central Garden Pet | Bridgford Foods vs. Central Garden Pet | Bridgford Foods vs. Lancaster Colony |
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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