Correlation Between GEN Restaurant and Jack In
Can any of the company-specific risk be diversified away by investing in both GEN Restaurant 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 GEN Restaurant and Jack In 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 Jack In The, you can compare the effects of market volatilities on GEN Restaurant 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 GEN Restaurant with a short position of Jack In. Check out your portfolio center. Please also check ongoing floating volatility patterns of GEN Restaurant and Jack In.
Diversification Opportunities for GEN Restaurant and Jack In
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GEN and Jack is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding GEN Restaurant Group, and Jack In The in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jack In 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 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 GEN Restaurant i.e., GEN Restaurant and Jack In go up and down completely randomly.
Pair Corralation between GEN Restaurant and Jack In
Given the investment horizon of 90 days GEN Restaurant Group, is expected to under-perform the Jack In. In addition to that, GEN Restaurant is 2.05 times more volatile than Jack In The. It trades about -0.11 of its total potential returns per unit of risk. Jack In The is currently generating about -0.09 per unit of volatility. If you would invest 5,053 in Jack In The on August 27, 2024 and sell it today you would lose (258.00) from holding Jack In The or give up 5.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GEN Restaurant Group, vs. Jack In The
Performance |
| Timeline |
| GEN Restaurant Group, |
| Jack In |
GEN Restaurant and Jack In Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GEN Restaurant and Jack In
The main advantage of trading using opposite GEN Restaurant and Jack In positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GEN Restaurant 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.| GEN Restaurant vs. Presidio Property Trust | GEN Restaurant vs. EvoAir Holdings | GEN Restaurant vs. AerSale Corp | GEN Restaurant vs. MGIC Investment Corp |
| 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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