Correlation Between Cheesecake Factory and Carbon Energy
Can any of the company-specific risk be diversified away by investing in both Cheesecake Factory and Carbon Energy 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 Carbon Energy 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 Carbon Energy, you can compare the effects of market volatilities on Cheesecake Factory and Carbon Energy 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 Carbon Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cheesecake Factory and Carbon Energy.
Diversification Opportunities for Cheesecake Factory and Carbon Energy
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Cheesecake and Carbon is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding The Cheesecake Factory and Carbon Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carbon Energy 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 Carbon Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carbon Energy has no effect on the direction of Cheesecake Factory i.e., Cheesecake Factory and Carbon Energy go up and down completely randomly.
Pair Corralation between Cheesecake Factory and Carbon Energy
Given the investment horizon of 90 days The Cheesecake Factory is expected to generate 1.37 times more return on investment than Carbon Energy. However, Cheesecake Factory is 1.37 times more volatile than Carbon Energy. It trades about 0.1 of its potential returns per unit of risk. Carbon Energy is currently generating about 0.09 per unit of risk. If you would invest 3,896 in The Cheesecake Factory on September 12, 2024 and sell it today you would earn a total of 1,111 from holding The Cheesecake Factory or generate 28.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Cheesecake Factory vs. Carbon Energy
Performance |
| Timeline |
| The Cheesecake Factory |
| Carbon Energy |
Cheesecake Factory and Carbon Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cheesecake Factory and Carbon Energy
The main advantage of trading using opposite Cheesecake Factory and Carbon Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cheesecake Factory position performs unexpectedly, Carbon Energy 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 Carbon Energy will offset losses from the drop in Carbon Energy's long position.| Cheesecake Factory vs. Dine Brands Global | Cheesecake Factory vs. Bloomin Brands | Cheesecake Factory vs. BJs Restaurants | Cheesecake Factory vs. Brinker International |
| Carbon Energy vs. BJs Restaurants | Carbon Energy vs. The Cheesecake Factory | Carbon Energy vs. Marine Products | Carbon Energy vs. Dominos Pizza |
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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