Correlation Between Jack In and Kura Sushi

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Can any of the company-specific risk be diversified away by investing in both Jack In and Kura Sushi 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 Kura Sushi 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 Kura Sushi USA, you can compare the effects of market volatilities on Jack In and Kura Sushi 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 Kura Sushi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jack In and Kura Sushi.

Diversification Opportunities for Jack In and Kura Sushi

0.3
  Correlation Coefficient

Weak diversification

The 3 months correlation between Jack and Kura is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Jack In The and Kura Sushi USA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kura Sushi USA 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 Kura Sushi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kura Sushi USA has no effect on the direction of Jack In i.e., Jack In and Kura Sushi go up and down completely randomly.

Pair Corralation between Jack In and Kura Sushi

Given the investment horizon of 90 days Jack In The is expected to under-perform the Kura Sushi. But the stock apears to be less risky and, when comparing its historical volatility, Jack In The is 1.49 times less risky than Kura Sushi. The stock trades about -0.03 of its potential returns per unit of risk. The Kura Sushi USA is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  6,659  in Kura Sushi USA on August 29, 2024 and sell it today you would earn a total of  3,879  from holding Kura Sushi USA or generate 58.25% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Jack In The  vs.  Kura Sushi USA

 Performance 
       Timeline  
Jack In 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Jack In The has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent fundamental indicators, Jack In is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.
Kura Sushi USA 

Risk-Adjusted Performance

15 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Kura Sushi USA are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively conflicting basic indicators, Kura Sushi unveiled solid returns over the last few months and may actually be approaching a breakup point.

Jack In and Kura Sushi Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Jack In and Kura Sushi

The main advantage of trading using opposite Jack In and Kura Sushi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jack In position performs unexpectedly, Kura Sushi 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 Kura Sushi will offset losses from the drop in Kura Sushi's long position.
The idea behind Jack In The and Kura Sushi USA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.

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