Correlation Between Kura Sushi and Drive Shack
Can any of the company-specific risk be diversified away by investing in both Kura Sushi and Drive Shack 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 Kura Sushi and Drive Shack into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kura Sushi USA and Drive Shack, you can compare the effects of market volatilities on Kura Sushi and Drive Shack 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 Kura Sushi with a short position of Drive Shack. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kura Sushi and Drive Shack.
Diversification Opportunities for Kura Sushi and Drive Shack
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kura and Drive is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Kura Sushi USA and Drive Shack in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Drive Shack and Kura Sushi 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 Kura Sushi USA are associated (or correlated) with Drive Shack. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Drive Shack has no effect on the direction of Kura Sushi i.e., Kura Sushi and Drive Shack go up and down completely randomly.
Pair Corralation between Kura Sushi and Drive Shack
Given the investment horizon of 90 days Kura Sushi is expected to generate 17.71 times less return on investment than Drive Shack. But when comparing it to its historical volatility, Kura Sushi USA is 2.85 times less risky than Drive Shack. It trades about 0.05 of its potential returns per unit of risk. Drive Shack is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 21.00 in Drive Shack on September 3, 2024 and sell it today you would earn a total of 19.00 from holding Drive Shack or generate 90.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.0% |
| Values | Daily Returns |
Kura Sushi USA vs. Drive Shack
Performance |
| Timeline |
| Kura Sushi USA |
| Drive Shack |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Kura Sushi and Drive Shack Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kura Sushi and Drive Shack
The main advantage of trading using opposite Kura Sushi and Drive Shack positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kura Sushi position performs unexpectedly, Drive Shack 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 Drive Shack will offset losses from the drop in Drive Shack's long position.| Kura Sushi vs. Brinker International | Kura Sushi vs. Dennys Corp | Kura Sushi vs. Bloomin Brands | Kura Sushi vs. Jack In The |
| Drive Shack vs. Bausch Lomb Corp | Drive Shack vs. Nike Inc | Drive Shack vs. National Vision Holdings | Drive Shack vs. Nyxoah |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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