Correlation Between Brinker International and Jack In
Can any of the company-specific risk be diversified away by investing in both Brinker International and Jack In 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 Jack In into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brinker International and Jack In The, you can compare the effects of market volatilities on Brinker International and Jack In 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 Jack In. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brinker International and Jack In.
Diversification Opportunities for Brinker International and Jack In
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Brinker and Jack is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Brinker International and Jack In The in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jack In 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 Jack In. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jack In has no effect on the direction of Brinker International i.e., Brinker International and Jack In go up and down completely randomly.
Pair Corralation between Brinker International and Jack In
Considering the 90-day investment horizon Brinker International is expected to generate 1.1 times more return on investment than Jack In. However, Brinker International is 1.1 times more volatile than Jack In The. It trades about 0.52 of its potential returns per unit of risk. Jack In The is currently generating about -0.09 per unit of risk. If you would invest 9,773 in Brinker International on August 28, 2024 and sell it today you would earn a total of 3,325 from holding Brinker International or generate 34.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Brinker International vs. Jack In The
Performance |
| Timeline |
| Brinker International |
| Jack In |
Brinker International and Jack In Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brinker International and Jack In
The main advantage of trading using opposite Brinker International and Jack In positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brinker International position performs unexpectedly, Jack In 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 Jack In will offset losses from the drop in Jack In'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 |
| Jack In vs. Dine Brands Global | Jack In vs. Bloomin Brands | Jack In vs. BJs Restaurants | Jack In vs. The Cheesecake Factory |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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