Correlation Between Dine Brands and Mach Natural
Can any of the company-specific risk be diversified away by investing in both Dine Brands and Mach Natural 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 Dine Brands and Mach Natural into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dine Brands Global and Mach Natural Resources, you can compare the effects of market volatilities on Dine Brands and Mach Natural 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 Dine Brands with a short position of Mach Natural. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dine Brands and Mach Natural.
Diversification Opportunities for Dine Brands and Mach Natural
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dine and Mach is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Dine Brands Global and Mach Natural Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mach Natural Resources and Dine Brands 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 Dine Brands Global are associated (or correlated) with Mach Natural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mach Natural Resources has no effect on the direction of Dine Brands i.e., Dine Brands and Mach Natural go up and down completely randomly.
Pair Corralation between Dine Brands and Mach Natural
Considering the 90-day investment horizon Dine Brands Global is expected to under-perform the Mach Natural. In addition to that, Dine Brands is 1.54 times more volatile than Mach Natural Resources. It trades about -0.03 of its total potential returns per unit of risk. Mach Natural Resources is currently generating about 0.03 per unit of volatility. If you would invest 1,409 in Mach Natural Resources on September 4, 2024 and sell it today you would earn a total of 134.00 from holding Mach Natural Resources or generate 9.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dine Brands Global vs. Mach Natural Resources
Performance |
| Timeline |
| Dine Brands Global |
| Mach Natural Resources |
Dine Brands and Mach Natural Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dine Brands and Mach Natural
The main advantage of trading using opposite Dine Brands and Mach Natural positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dine Brands position performs unexpectedly, Mach Natural 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 Mach Natural will offset losses from the drop in Mach Natural's long position.| Dine Brands vs. Bloomin Brands | Dine Brands vs. BJs Restaurants | Dine Brands vs. The Cheesecake Factory | Dine Brands vs. Brinker International |
| Mach Natural vs. WT Offshore | Mach Natural vs. BW Offshore Limited | Mach Natural vs. Asure Software | Mach Natural vs. Jutal Offshore Oil |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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