Correlation Between Escalade Incorporated and Bowlero Corp
Can any of the company-specific risk be diversified away by investing in both Escalade Incorporated and Bowlero Corp 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 Escalade Incorporated and Bowlero Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Escalade Incorporated and Bowlero Corp, you can compare the effects of market volatilities on Escalade Incorporated and Bowlero Corp 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 Escalade Incorporated with a short position of Bowlero Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Escalade Incorporated and Bowlero Corp.
Diversification Opportunities for Escalade Incorporated and Bowlero Corp
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Escalade and Bowlero is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Escalade Incorporated and Bowlero Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bowlero Corp and Escalade Incorporated 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 Escalade Incorporated are associated (or correlated) with Bowlero Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bowlero Corp has no effect on the direction of Escalade Incorporated i.e., Escalade Incorporated and Bowlero Corp go up and down completely randomly.
Pair Corralation between Escalade Incorporated and Bowlero Corp
Given the investment horizon of 90 days Escalade Incorporated is expected to generate 0.88 times more return on investment than Bowlero Corp. However, Escalade Incorporated is 1.13 times less risky than Bowlero Corp. It trades about 0.03 of its potential returns per unit of risk. Bowlero Corp is currently generating about 0.0 per unit of risk. If you would invest 1,155 in Escalade Incorporated on October 23, 2024 and sell it today you would earn a total of 345.00 from holding Escalade Incorporated or generate 29.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.37% |
| Values | Daily Returns |
Escalade Incorporated vs. Bowlero Corp
Performance |
| Timeline |
| Escalade Incorporated |
| Bowlero Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Escalade Incorporated and Bowlero Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Escalade Incorporated and Bowlero Corp
The main advantage of trading using opposite Escalade Incorporated and Bowlero Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Escalade Incorporated position performs unexpectedly, Bowlero Corp 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 Bowlero Corp will offset losses from the drop in Bowlero Corp's long position.| Escalade Incorporated vs. Johnson Outdoors | Escalade Incorporated vs. First Business Financial | Escalade Incorporated vs. Flexsteel Industries | Escalade Incorporated vs. Superior Uniform Group |
| Bowlero Corp vs. Acushnet Holdings Corp | Bowlero Corp vs. YETI Holdings | Bowlero Corp vs. Madison Square Garden | Bowlero Corp vs. Life Time Group |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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