Correlation Between Driven Brands and SHP ETF
Can any of the company-specific risk be diversified away by investing in both Driven Brands and SHP ETF 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 Driven Brands and SHP ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Driven Brands Holdings and SHP ETF Trust, you can compare the effects of market volatilities on Driven Brands and SHP ETF 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 Driven Brands with a short position of SHP ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Driven Brands and SHP ETF.
Diversification Opportunities for Driven Brands and SHP ETF
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Driven and SHP is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Driven Brands Holdings and SHP ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SHP ETF Trust and Driven 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 Driven Brands Holdings are associated (or correlated) with SHP ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SHP ETF Trust has no effect on the direction of Driven Brands i.e., Driven Brands and SHP ETF go up and down completely randomly.
Pair Corralation between Driven Brands and SHP ETF
Given the investment horizon of 90 days Driven Brands Holdings is expected to generate 8.3 times more return on investment than SHP ETF. However, Driven Brands is 8.3 times more volatile than SHP ETF Trust. It trades about 0.05 of its potential returns per unit of risk. SHP ETF Trust is currently generating about 0.07 per unit of risk. If you would invest 1,380 in Driven Brands Holdings on September 1, 2024 and sell it today you would earn a total of 305.00 from holding Driven Brands Holdings or generate 22.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.47% |
| Values | Daily Returns |
Driven Brands Holdings vs. SHP ETF Trust
Performance |
| Timeline |
| Driven Brands Holdings |
| SHP ETF Trust |
Driven Brands and SHP ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Driven Brands and SHP ETF
The main advantage of trading using opposite Driven Brands and SHP ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Driven Brands position performs unexpectedly, SHP ETF 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 SHP ETF will offset losses from the drop in SHP ETF's long position.| Driven Brands vs. CarGurus | Driven Brands vs. KAR Auction Services | Driven Brands vs. Kingsway Financial Services | Driven Brands vs. Group 1 Automotive |
| SHP ETF vs. Valued Advisers Trust | SHP ETF vs. Columbia Diversified Fixed | SHP ETF vs. Principal Exchange Traded Funds | SHP ETF vs. Doubleline Etf Trust |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |