Correlation Between Driven Brands and Conrad Industries
Can any of the company-specific risk be diversified away by investing in both Driven Brands and Conrad Industries 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 Conrad Industries 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 Conrad Industries, you can compare the effects of market volatilities on Driven Brands and Conrad Industries 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 Conrad Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Driven Brands and Conrad Industries.
Diversification Opportunities for Driven Brands and Conrad Industries
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Driven and Conrad is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Driven Brands Holdings and Conrad Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Conrad Industries 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 Conrad Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Conrad Industries has no effect on the direction of Driven Brands i.e., Driven Brands and Conrad Industries go up and down completely randomly.
Pair Corralation between Driven Brands and Conrad Industries
If you would invest 1,407 in Driven Brands Holdings on September 2, 2024 and sell it today you would earn a total of 278.00 from holding Driven Brands Holdings or generate 19.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 1.56% |
| Values | Daily Returns |
Driven Brands Holdings vs. Conrad Industries
Performance |
| Timeline |
| Driven Brands Holdings |
| Conrad Industries |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Driven Brands and Conrad Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Driven Brands and Conrad Industries
The main advantage of trading using opposite Driven Brands and Conrad Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Driven Brands position performs unexpectedly, Conrad Industries 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 Conrad Industries will offset losses from the drop in Conrad Industries' long position.| Driven Brands vs. CarGurus | Driven Brands vs. KAR Auction Services | Driven Brands vs. Kingsway Financial Services | Driven Brands vs. Group 1 Automotive |
| Conrad Industries vs. Thales SA ADR | Conrad Industries vs. MTU Aero Engines | Conrad Industries vs. Safran SA | Conrad Industries vs. Leonardo SpA ADR |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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