Correlation Between Jack In and Ark Restaurants
Can any of the company-specific risk be diversified away by investing in both Jack In and Ark 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 Jack In and Ark Restaurants into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jack In The and Ark Restaurants Corp, you can compare the effects of market volatilities on Jack In and Ark 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 Jack In with a short position of Ark Restaurants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jack In and Ark Restaurants.
Diversification Opportunities for Jack In and Ark Restaurants
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Jack and Ark is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Jack In The and Ark Restaurants Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ark Restaurants Corp and Jack In 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 Jack In The are associated (or correlated) with Ark Restaurants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ark Restaurants Corp has no effect on the direction of Jack In i.e., Jack In and Ark Restaurants go up and down completely randomly.
Pair Corralation between Jack In and Ark Restaurants
Given the investment horizon of 90 days Jack In The is expected to under-perform the Ark Restaurants. But the stock apears to be less risky and, when comparing its historical volatility, Jack In The is 2.91 times less risky than Ark Restaurants. The stock trades about -0.11 of its potential returns per unit of risk. The Ark Restaurants Corp is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,276 in Ark Restaurants Corp on November 3, 2024 and sell it today you would earn a total of 55.00 from holding Ark Restaurants Corp or generate 4.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Jack In The vs. Ark Restaurants Corp
Performance |
| Timeline |
| Jack In |
| Ark Restaurants Corp |
Jack In and Ark Restaurants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jack In and Ark Restaurants
The main advantage of trading using opposite Jack In and Ark Restaurants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jack In position performs unexpectedly, Ark 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 Ark Restaurants will offset losses from the drop in Ark Restaurants' long position.| Jack In vs. Dine Brands Global | Jack In vs. Bloomin Brands | Jack In vs. BJs Restaurants | Jack In vs. The Cheesecake Factory |
| Ark Restaurants vs. Nathans Famous | Ark Restaurants vs. Flanigans Enterprises | Ark Restaurants vs. Good Times Restaurants | Ark Restaurants vs. Auburn National Bancorporation |
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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