Correlation Between GEN Restaurant and Sweetgreen
Can any of the company-specific risk be diversified away by investing in both GEN Restaurant and Sweetgreen 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 Sweetgreen 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 Sweetgreen, you can compare the effects of market volatilities on GEN Restaurant and Sweetgreen 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 Sweetgreen. Check out your portfolio center. Please also check ongoing floating volatility patterns of GEN Restaurant and Sweetgreen.
Diversification Opportunities for GEN Restaurant and Sweetgreen
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between GEN and Sweetgreen is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding GEN Restaurant Group, and Sweetgreen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sweetgreen 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 Sweetgreen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sweetgreen has no effect on the direction of GEN Restaurant i.e., GEN Restaurant and Sweetgreen go up and down completely randomly.
Pair Corralation between GEN Restaurant and Sweetgreen
Given the investment horizon of 90 days GEN Restaurant Group, is expected to under-perform the Sweetgreen. In addition to that, GEN Restaurant is 1.01 times more volatile than Sweetgreen. It trades about -0.02 of its total potential returns per unit of risk. Sweetgreen is currently generating about 0.13 per unit of volatility. If you would invest 3,576 in Sweetgreen on August 26, 2024 and sell it today you would earn a total of 764.00 from holding Sweetgreen or generate 21.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GEN Restaurant Group, vs. Sweetgreen
Performance |
| Timeline |
| GEN Restaurant Group, |
| Sweetgreen |
GEN Restaurant and Sweetgreen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GEN Restaurant and Sweetgreen
The main advantage of trading using opposite GEN Restaurant and Sweetgreen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GEN Restaurant position performs unexpectedly, Sweetgreen 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 Sweetgreen will offset losses from the drop in Sweetgreen's long position.| GEN Restaurant vs. Dream Finders Homes | GEN Restaurant vs. Boot Barn Holdings | GEN Restaurant vs. Victorias Secret Co | GEN Restaurant vs. Parker Hannifin |
| Sweetgreen vs. Cannae Holdings | Sweetgreen vs. Brinker International | Sweetgreen vs. Jack In The | Sweetgreen vs. Biglari Holdings |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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