Correlation Between GEN Restaurant and Titan International
Can any of the company-specific risk be diversified away by investing in both GEN Restaurant and Titan International 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 Titan International 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 Titan International, you can compare the effects of market volatilities on GEN Restaurant and Titan International 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 Titan International. Check out your portfolio center. Please also check ongoing floating volatility patterns of GEN Restaurant and Titan International.
Diversification Opportunities for GEN Restaurant and Titan International
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between GEN and Titan is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding GEN Restaurant Group, and Titan International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Titan International 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 Titan International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Titan International has no effect on the direction of GEN Restaurant i.e., GEN Restaurant and Titan International go up and down completely randomly.
Pair Corralation between GEN Restaurant and Titan International
Given the investment horizon of 90 days GEN Restaurant Group, is expected to generate 1.22 times more return on investment than Titan International. However, GEN Restaurant is 1.22 times more volatile than Titan International. It trades about -0.02 of its potential returns per unit of risk. Titan International is currently generating about -0.08 per unit of risk. If you would invest 1,101 in GEN Restaurant Group, on September 3, 2024 and sell it today you would lose (253.00) from holding GEN Restaurant Group, or give up 22.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GEN Restaurant Group, vs. Titan International
Performance |
| Timeline |
| GEN Restaurant Group, |
| Titan International |
GEN Restaurant and Titan International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GEN Restaurant and Titan International
The main advantage of trading using opposite GEN Restaurant and Titan International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GEN Restaurant position performs unexpectedly, Titan International 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 Titan International will offset losses from the drop in Titan International's long position.| GEN Restaurant vs. SL Green Realty | GEN Restaurant vs. Haverty Furniture Companies | GEN Restaurant vs. FiscalNote Holdings | GEN Restaurant vs. Cadence Design Systems |
| Titan International vs. Shyft Group | Titan International vs. Manitowoc | Titan International vs. Oshkosh | Titan International vs. Terex |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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