Correlation Between Cheesecake Factory and Beneficient Warrant
Can any of the company-specific risk be diversified away by investing in both Cheesecake Factory and Beneficient Warrant 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 Cheesecake Factory and Beneficient Warrant into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Cheesecake Factory and Beneficient Warrant, you can compare the effects of market volatilities on Cheesecake Factory and Beneficient Warrant 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 Cheesecake Factory with a short position of Beneficient Warrant. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cheesecake Factory and Beneficient Warrant.
Diversification Opportunities for Cheesecake Factory and Beneficient Warrant
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Cheesecake and Beneficient is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding The Cheesecake Factory and Beneficient Warrant in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beneficient Warrant and Cheesecake Factory 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 The Cheesecake Factory are associated (or correlated) with Beneficient Warrant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beneficient Warrant has no effect on the direction of Cheesecake Factory i.e., Cheesecake Factory and Beneficient Warrant go up and down completely randomly.
Pair Corralation between Cheesecake Factory and Beneficient Warrant
Given the investment horizon of 90 days Cheesecake Factory is expected to generate 1.74 times less return on investment than Beneficient Warrant. But when comparing it to its historical volatility, The Cheesecake Factory is 4.4 times less risky than Beneficient Warrant. It trades about 0.13 of its potential returns per unit of risk. Beneficient Warrant is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 0.88 in Beneficient Warrant on October 24, 2024 and sell it today you would earn a total of 0.02 from holding Beneficient Warrant or generate 2.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Cheesecake Factory vs. Beneficient Warrant
Performance |
| Timeline |
| The Cheesecake Factory |
| Beneficient Warrant |
Cheesecake Factory and Beneficient Warrant Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cheesecake Factory and Beneficient Warrant
The main advantage of trading using opposite Cheesecake Factory and Beneficient Warrant positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cheesecake Factory position performs unexpectedly, Beneficient Warrant 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 Beneficient Warrant will offset losses from the drop in Beneficient Warrant's long position.| Cheesecake Factory vs. Dine Brands Global | Cheesecake Factory vs. Bloomin Brands | Cheesecake Factory vs. BJs Restaurants | Cheesecake Factory vs. Brinker International |
| Beneficient Warrant vs. Dennys Corp | Beneficient Warrant vs. The Cheesecake Factory | Beneficient Warrant vs. Thai Beverage PCL | Beneficient Warrant vs. Shake Shack |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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