Correlation Between Chipotle Mexican and WisdomTree Battery
Can any of the company-specific risk be diversified away by investing in both Chipotle Mexican and WisdomTree Battery 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 Chipotle Mexican and WisdomTree Battery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chipotle Mexican Grill and WisdomTree Battery Solutions, you can compare the effects of market volatilities on Chipotle Mexican and WisdomTree Battery 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 Chipotle Mexican with a short position of WisdomTree Battery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chipotle Mexican and WisdomTree Battery.
Diversification Opportunities for Chipotle Mexican and WisdomTree Battery
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Chipotle and WisdomTree is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Chipotle Mexican Grill and WisdomTree Battery Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Battery and Chipotle Mexican 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 Chipotle Mexican Grill are associated (or correlated) with WisdomTree Battery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Battery has no effect on the direction of Chipotle Mexican i.e., Chipotle Mexican and WisdomTree Battery go up and down completely randomly.
Pair Corralation between Chipotle Mexican and WisdomTree Battery
Considering the 90-day investment horizon Chipotle Mexican Grill is expected to generate 1.14 times more return on investment than WisdomTree Battery. However, Chipotle Mexican is 1.14 times more volatile than WisdomTree Battery Solutions. It trades about 0.21 of its potential returns per unit of risk. WisdomTree Battery Solutions is currently generating about 0.02 per unit of risk. If you would invest 3,132 in Chipotle Mexican Grill on November 12, 2025 and sell it today you would earn a total of 827.00 from holding Chipotle Mexican Grill or generate 26.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 96.67% |
| Values | Daily Returns |
Chipotle Mexican Grill vs. WisdomTree Battery Solutions
Performance |
| Timeline |
| Chipotle Mexican Grill |
| WisdomTree Battery |
Chipotle Mexican and WisdomTree Battery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chipotle Mexican and WisdomTree Battery
The main advantage of trading using opposite Chipotle Mexican and WisdomTree Battery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chipotle Mexican position performs unexpectedly, WisdomTree Battery 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 WisdomTree Battery will offset losses from the drop in WisdomTree Battery's long position.| Chipotle Mexican vs. Yum Brands | Chipotle Mexican vs. Las Vegas Sands | Chipotle Mexican vs. Copart Inc | Chipotle Mexican vs. DR Horton |
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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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