Correlation Between Kandi Technologies and BJs Restaurants
Can any of the company-specific risk be diversified away by investing in both Kandi Technologies and BJs 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 Kandi Technologies and BJs Restaurants into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kandi Technologies Group and BJs Restaurants, you can compare the effects of market volatilities on Kandi Technologies and BJs 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 Kandi Technologies with a short position of BJs Restaurants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kandi Technologies and BJs Restaurants.
Diversification Opportunities for Kandi Technologies and BJs Restaurants
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Kandi and BJs is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Kandi Technologies Group and BJs Restaurants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BJs Restaurants and Kandi Technologies 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 Kandi Technologies Group are associated (or correlated) with BJs Restaurants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BJs Restaurants has no effect on the direction of Kandi Technologies i.e., Kandi Technologies and BJs Restaurants go up and down completely randomly.
Pair Corralation between Kandi Technologies and BJs Restaurants
Given the investment horizon of 90 days Kandi Technologies Group is expected to under-perform the BJs Restaurants. In addition to that, Kandi Technologies is 1.58 times more volatile than BJs Restaurants. It trades about -0.11 of its total potential returns per unit of risk. BJs Restaurants is currently generating about 0.01 per unit of volatility. If you would invest 3,730 in BJs Restaurants on August 28, 2024 and sell it today you would lose (9.00) from holding BJs Restaurants or give up 0.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kandi Technologies Group vs. BJs Restaurants
Performance |
| Timeline |
| Kandi Technologies |
| BJs Restaurants |
Kandi Technologies and BJs Restaurants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kandi Technologies and BJs Restaurants
The main advantage of trading using opposite Kandi Technologies and BJs Restaurants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kandi Technologies position performs unexpectedly, BJs 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 BJs Restaurants will offset losses from the drop in BJs Restaurants' long position.| Kandi Technologies vs. Hyliion Holdings Corp | Kandi Technologies vs. Foresight Autonomous Holdings | Kandi Technologies vs. Aeva Technologies | Kandi Technologies vs. Aeye Inc |
| BJs Restaurants vs. Dine Brands Global | BJs Restaurants vs. Brinker International | BJs Restaurants vs. Bloomin Brands | BJs Restaurants vs. The Cheesecake Factory |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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