Correlation Between Cheesecake Factory and Coupang LLC
Can any of the company-specific risk be diversified away by investing in both Cheesecake Factory and Coupang LLC 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 Coupang LLC 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 Coupang LLC, you can compare the effects of market volatilities on Cheesecake Factory and Coupang LLC 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 Coupang LLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cheesecake Factory and Coupang LLC.
Diversification Opportunities for Cheesecake Factory and Coupang LLC
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Cheesecake and Coupang is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding The Cheesecake Factory and Coupang LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coupang LLC 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 Coupang LLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coupang LLC has no effect on the direction of Cheesecake Factory i.e., Cheesecake Factory and Coupang LLC go up and down completely randomly.
Pair Corralation between Cheesecake Factory and Coupang LLC
Given the investment horizon of 90 days The Cheesecake Factory is expected to generate 0.64 times more return on investment than Coupang LLC. However, The Cheesecake Factory is 1.56 times less risky than Coupang LLC. It trades about 0.22 of its potential returns per unit of risk. Coupang LLC is currently generating about -0.01 per unit of risk. If you would invest 4,596 in The Cheesecake Factory on September 1, 2024 and sell it today you would earn a total of 468.00 from holding The Cheesecake Factory or generate 10.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Cheesecake Factory vs. Coupang LLC
Performance |
| Timeline |
| The Cheesecake Factory |
| Coupang LLC |
Cheesecake Factory and Coupang LLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cheesecake Factory and Coupang LLC
The main advantage of trading using opposite Cheesecake Factory and Coupang LLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cheesecake Factory position performs unexpectedly, Coupang LLC 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 Coupang LLC will offset losses from the drop in Coupang LLC's long position.| Cheesecake Factory vs. The Wendys Co | Cheesecake Factory vs. Shake Shack | Cheesecake Factory vs. Papa Johns International | Cheesecake Factory vs. Darden Restaurants |
| Coupang LLC vs. PDD Holdings | Coupang LLC vs. JD Inc Adr | Coupang LLC vs. Alibaba Group Holding | Coupang LLC vs. Sea |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |