Correlation Between Dine Brands and Top KingWin
Can any of the company-specific risk be diversified away by investing in both Dine Brands and Top KingWin 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 Top KingWin 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 Top KingWin Ltd, you can compare the effects of market volatilities on Dine Brands and Top KingWin 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 Top KingWin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dine Brands and Top KingWin.
Diversification Opportunities for Dine Brands and Top KingWin
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Dine and Top is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Dine Brands Global and Top KingWin Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Top KingWin 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 Top KingWin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Top KingWin has no effect on the direction of Dine Brands i.e., Dine Brands and Top KingWin go up and down completely randomly.
Pair Corralation between Dine Brands and Top KingWin
Considering the 90-day investment horizon Dine Brands Global is expected to under-perform the Top KingWin. But the stock apears to be less risky and, when comparing its historical volatility, Dine Brands Global is 7.85 times less risky than Top KingWin. The stock trades about -0.04 of its potential returns per unit of risk. The Top KingWin Ltd is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 50.00 in Top KingWin Ltd on September 12, 2024 and sell it today you would lose (11.00) from holding Top KingWin Ltd or give up 22.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Dine Brands Global vs. Top KingWin Ltd
Performance |
| Timeline |
| Dine Brands Global |
| Top KingWin |
Dine Brands and Top KingWin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dine Brands and Top KingWin
The main advantage of trading using opposite Dine Brands and Top KingWin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dine Brands position performs unexpectedly, Top KingWin 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 Top KingWin will offset losses from the drop in Top KingWin's long position.| Dine Brands vs. Noble Romans | Dine Brands vs. Good Times Restaurants | Dine Brands vs. Flanigans Enterprises | Dine Brands vs. FAT Brands |
| Top KingWin vs. Dine Brands Global | Top KingWin vs. Lincoln Educational Services | Top KingWin vs. Afya | Top KingWin vs. Summit Hotel Properties |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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