Correlation Between Cracker Barrel and Coupang LLC
Can any of the company-specific risk be diversified away by investing in both Cracker Barrel 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 Cracker Barrel and Coupang LLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cracker Barrel Old and Coupang LLC, you can compare the effects of market volatilities on Cracker Barrel 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 Cracker Barrel with a short position of Coupang LLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cracker Barrel and Coupang LLC.
Diversification Opportunities for Cracker Barrel and Coupang LLC
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cracker and Coupang is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Cracker Barrel Old and Coupang LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coupang LLC and Cracker Barrel 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 Cracker Barrel Old 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 Cracker Barrel i.e., Cracker Barrel and Coupang LLC go up and down completely randomly.
Pair Corralation between Cracker Barrel and Coupang LLC
Given the investment horizon of 90 days Cracker Barrel Old is expected to under-perform the Coupang LLC. In addition to that, Cracker Barrel is 1.12 times more volatile than Coupang LLC. It trades about -0.02 of its total potential returns per unit of risk. Coupang LLC is currently generating about 0.04 per unit of volatility. If you would invest 1,787 in Coupang LLC on August 31, 2024 and sell it today you would earn a total of 760.00 from holding Coupang LLC or generate 42.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Cracker Barrel Old vs. Coupang LLC
Performance |
| Timeline |
| Cracker Barrel Old |
| Coupang LLC |
Cracker Barrel and Coupang LLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cracker Barrel and Coupang LLC
The main advantage of trading using opposite Cracker Barrel and Coupang LLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cracker Barrel 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.| Cracker Barrel vs. Brinker International | Cracker Barrel vs. BJs Restaurants | Cracker Barrel vs. Texas Roadhouse | Cracker Barrel vs. Papa Johns International |
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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