Correlation Between Kaltura and Cheesecake Factory
Can any of the company-specific risk be diversified away by investing in both Kaltura and Cheesecake Factory 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 Kaltura and Cheesecake Factory into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kaltura and The Cheesecake Factory, you can compare the effects of market volatilities on Kaltura and Cheesecake Factory 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 Kaltura with a short position of Cheesecake Factory. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kaltura and Cheesecake Factory.
Diversification Opportunities for Kaltura and Cheesecake Factory
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kaltura and Cheesecake is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Kaltura and The Cheesecake Factory in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The Cheesecake Factory and Kaltura 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 Kaltura are associated (or correlated) with Cheesecake Factory. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of The Cheesecake Factory has no effect on the direction of Kaltura i.e., Kaltura and Cheesecake Factory go up and down completely randomly.
Pair Corralation between Kaltura and Cheesecake Factory
Given the investment horizon of 90 days Kaltura is expected to generate 1.86 times more return on investment than Cheesecake Factory. However, Kaltura is 1.86 times more volatile than The Cheesecake Factory. It trades about 0.27 of its potential returns per unit of risk. The Cheesecake Factory is currently generating about 0.19 per unit of risk. If you would invest 112.00 in Kaltura on September 2, 2024 and sell it today you would earn a total of 110.00 from holding Kaltura or generate 98.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kaltura vs. The Cheesecake Factory
Performance |
| Timeline |
| Kaltura |
| The Cheesecake Factory |
Kaltura and Cheesecake Factory Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kaltura and Cheesecake Factory
The main advantage of trading using opposite Kaltura and Cheesecake Factory positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kaltura position performs unexpectedly, Cheesecake Factory 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 Cheesecake Factory will offset losses from the drop in Cheesecake Factory's long position.| Kaltura vs. Evertec | Kaltura vs. Consensus Cloud Solutions | Kaltura vs. Global Blue Group | Kaltura vs. Lesaka Technologies |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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