Correlation Between GEN Restaurant and Alpha One
Can any of the company-specific risk be diversified away by investing in both GEN Restaurant and Alpha One 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 GEN Restaurant and Alpha One into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GEN Restaurant Group, and Alpha One, you can compare the effects of market volatilities on GEN Restaurant and Alpha One 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 GEN Restaurant with a short position of Alpha One. Check out your portfolio center. Please also check ongoing floating volatility patterns of GEN Restaurant and Alpha One.
Diversification Opportunities for GEN Restaurant and Alpha One
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GEN and Alpha is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding GEN Restaurant Group, and Alpha One in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alpha One and GEN Restaurant 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 GEN Restaurant Group, are associated (or correlated) with Alpha One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alpha One has no effect on the direction of GEN Restaurant i.e., GEN Restaurant and Alpha One go up and down completely randomly.
Pair Corralation between GEN Restaurant and Alpha One
If you would invest 154.00 in Alpha One on October 30, 2024 and sell it today you would earn a total of 0.00 from holding Alpha One or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 90.0% |
| Values | Daily Returns |
GEN Restaurant Group, vs. Alpha One
Performance |
| Timeline |
| GEN Restaurant Group, |
| Alpha One |
GEN Restaurant and Alpha One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GEN Restaurant and Alpha One
The main advantage of trading using opposite GEN Restaurant and Alpha One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GEN Restaurant position performs unexpectedly, Alpha One 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 Alpha One will offset losses from the drop in Alpha One's long position.| GEN Restaurant vs. Magnite | GEN Restaurant vs. Insteel Industries | GEN Restaurant vs. Zijin Mining Group | GEN Restaurant vs. Integral Ad Science |
| Alpha One vs. Sphere Entertainment Co | Alpha One vs. NETGEAR | Alpha One vs. Elite Education Group | Alpha One vs. Deluxe |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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