Correlation Between Dana and Sweetgreen
Can any of the company-specific risk be diversified away by investing in both Dana and Sweetgreen 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 Dana and Sweetgreen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dana Inc and Sweetgreen, you can compare the effects of market volatilities on Dana and Sweetgreen 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 Dana with a short position of Sweetgreen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dana and Sweetgreen.
Diversification Opportunities for Dana and Sweetgreen
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Dana and Sweetgreen is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Dana Inc and Sweetgreen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sweetgreen and Dana 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 Dana Inc are associated (or correlated) with Sweetgreen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sweetgreen has no effect on the direction of Dana i.e., Dana and Sweetgreen go up and down completely randomly.
Pair Corralation between Dana and Sweetgreen
Considering the 90-day investment horizon Dana Inc is expected to generate 0.46 times more return on investment than Sweetgreen. However, Dana Inc is 2.17 times less risky than Sweetgreen. It trades about 0.0 of its potential returns per unit of risk. Sweetgreen is currently generating about -0.24 per unit of risk. If you would invest 1,563 in Dana Inc on November 28, 2024 and sell it today you would lose (5.00) from holding Dana Inc or give up 0.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dana Inc vs. Sweetgreen
Performance |
| Timeline |
| Dana Inc |
| Sweetgreen |
Dana and Sweetgreen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dana and Sweetgreen
The main advantage of trading using opposite Dana and Sweetgreen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dana position performs unexpectedly, Sweetgreen 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 Sweetgreen will offset losses from the drop in Sweetgreen's long position.The idea behind Dana Inc and Sweetgreen pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Sweetgreen vs. Cannae Holdings | Sweetgreen vs. Brinker International | Sweetgreen vs. Jack In The | Sweetgreen vs. Biglari Holdings |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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