Correlation Between Fukuyama Transporting and BJs Restaurants
Can any of the company-specific risk be diversified away by investing in both Fukuyama Transporting and BJs Restaurants 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 Fukuyama Transporting and BJs Restaurants into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fukuyama Transporting Co and BJs Restaurants, you can compare the effects of market volatilities on Fukuyama Transporting and BJs Restaurants 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 Fukuyama Transporting with a short position of BJs Restaurants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fukuyama Transporting and BJs Restaurants.
Diversification Opportunities for Fukuyama Transporting and BJs Restaurants
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fukuyama and BJs is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Fukuyama Transporting Co and BJs Restaurants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BJs Restaurants and Fukuyama Transporting 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 Fukuyama Transporting Co are associated (or correlated) with BJs Restaurants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BJs Restaurants has no effect on the direction of Fukuyama Transporting i.e., Fukuyama Transporting and BJs Restaurants go up and down completely randomly.
Pair Corralation between Fukuyama Transporting and BJs Restaurants
Assuming the 90 days horizon Fukuyama Transporting Co is expected to generate 0.82 times more return on investment than BJs Restaurants. However, Fukuyama Transporting Co is 1.22 times less risky than BJs Restaurants. It trades about 0.03 of its potential returns per unit of risk. BJs Restaurants is currently generating about 0.01 per unit of risk. If you would invest 1,952 in Fukuyama Transporting Co on August 25, 2024 and sell it today you would earn a total of 168.00 from holding Fukuyama Transporting Co or generate 8.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fukuyama Transporting Co vs. BJs Restaurants
Performance |
| Timeline |
| Fukuyama Transporting |
| BJs Restaurants |
Fukuyama Transporting and BJs Restaurants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fukuyama Transporting and BJs Restaurants
The main advantage of trading using opposite Fukuyama Transporting and BJs Restaurants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fukuyama Transporting position performs unexpectedly, BJs Restaurants 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 BJs Restaurants will offset losses from the drop in BJs Restaurants' long position.| Fukuyama Transporting vs. Heartland Express | Fukuyama Transporting vs. Superior Plus Corp | Fukuyama Transporting vs. NMI Holdings | Fukuyama Transporting vs. Origin Agritech |
| BJs Restaurants vs. Gladstone Investment | BJs Restaurants vs. Strategic Investments AS | BJs Restaurants vs. CDN IMPERIAL BANK | BJs Restaurants vs. HK Electric Investments |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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