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 LLC, 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
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Brinker and BurgerFi is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Brinker International and BurgerFi International LLC 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 5.18 times less return on investment than BurgerFi International. But when comparing it to its historical volatility, Brinker International is 9.7 times less risky than BurgerFi International. It trades about 0.19 of its potential returns per unit of risk. BurgerFi International LLC is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1.54 in BurgerFi International LLC on August 31, 2024 and sell it today you would lose (0.64) from holding BurgerFi International LLC or give up 41.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 61.42% |
| Values | Daily Returns |
Brinker International vs. BurgerFi International LLC
Performance |
| Timeline |
| Brinker International |
| BurgerFi International |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
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 |
| BurgerFi International vs. Canoo Holdings | BurgerFi International vs. Landsea Homes | BurgerFi International vs. Nuvve Holding Corp |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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