Correlation Between Brinker International and Burgerfi International
Can any of the company-specific risk be diversified away by investing in both Brinker International and Burgerfi International 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 Brinker International and Burgerfi International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brinker International and Burgerfi International, you can compare the effects of market volatilities on Brinker International and Burgerfi International 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 Brinker International with a short position of Burgerfi International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brinker International and Burgerfi International.
Diversification Opportunities for Brinker International and Burgerfi International
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Brinker and Burgerfi is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Brinker International and Burgerfi International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Burgerfi International and Brinker International 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 Brinker International are associated (or correlated) with Burgerfi International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Burgerfi International has no effect on the direction of Brinker International i.e., Brinker International and Burgerfi International go up and down completely randomly.
Pair Corralation between Brinker International and Burgerfi International
Considering the 90-day investment horizon Brinker International is expected to generate 0.24 times more return on investment than Burgerfi International. However, Brinker International is 4.14 times less risky than Burgerfi International. It trades about 0.15 of its potential returns per unit of risk. Burgerfi International is currently generating about -0.05 per unit of risk. If you would invest 3,600 in Brinker International on September 1, 2024 and sell it today you would earn a total of 9,627 from holding Brinker International or generate 267.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 87.1% |
| Values | Daily Returns |
Brinker International vs. Burgerfi International
Performance |
| Timeline |
| Brinker International |
| Burgerfi International |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Brinker International and Burgerfi International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brinker International and Burgerfi International
The main advantage of trading using opposite Brinker International and Burgerfi International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brinker International position performs unexpectedly, Burgerfi International 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 Burgerfi International will offset losses from the drop in Burgerfi International's long position.| Brinker International vs. Dennys Corp | Brinker International vs. Bloomin Brands | Brinker International vs. Jack In The | Brinker International vs. Dine Brands Global |
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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