Correlation Between Brinker International and American Funds
Can any of the company-specific risk be diversified away by investing in both Brinker International and American Funds 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 American Funds into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brinker International and American Funds The, you can compare the effects of market volatilities on Brinker International and American Funds 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 American Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brinker International and American Funds.
Diversification Opportunities for Brinker International and American Funds
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Brinker and American is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Brinker International and American Funds The in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Funds 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 American Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Funds has no effect on the direction of Brinker International i.e., Brinker International and American Funds go up and down completely randomly.
Pair Corralation between Brinker International and American Funds
Considering the 90-day investment horizon Brinker International is expected to generate 6.64 times more return on investment than American Funds. However, Brinker International is 6.64 times more volatile than American Funds The. It trades about 0.53 of its potential returns per unit of risk. American Funds The is currently generating about 0.05 per unit of risk. If you would invest 10,271 in Brinker International on September 1, 2024 and sell it today you would earn a total of 2,956 from holding Brinker International or generate 28.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Brinker International vs. American Funds The
Performance |
| Timeline |
| Brinker International |
| American Funds |
Brinker International and American Funds Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brinker International and American Funds
The main advantage of trading using opposite Brinker International and American Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brinker International position performs unexpectedly, American Funds 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 American Funds will offset losses from the drop in American Funds' long position.| Brinker International vs. Dennys Corp | Brinker International vs. Bloomin Brands | Brinker International vs. Jack In The | Brinker International vs. Dine Brands Global |
| American Funds vs. Income Fund Of | American Funds vs. American Funds 2015 | American Funds vs. New World Fund | American Funds vs. American Mutual Fund |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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