Correlation Between Joint Stock and Sweetgreen
Can any of the company-specific risk be diversified away by investing in both Joint Stock and Sweetgreen 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 Joint Stock and Sweetgreen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Joint Stock and Sweetgreen, you can compare the effects of market volatilities on Joint Stock and Sweetgreen 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 Joint Stock with a short position of Sweetgreen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Joint Stock and Sweetgreen.
Diversification Opportunities for Joint Stock and Sweetgreen
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Joint and Sweetgreen is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Joint Stock and Sweetgreen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sweetgreen and Joint Stock 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 Joint Stock are associated (or correlated) with Sweetgreen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sweetgreen has no effect on the direction of Joint Stock i.e., Joint Stock and Sweetgreen go up and down completely randomly.
Pair Corralation between Joint Stock and Sweetgreen
Given the investment horizon of 90 days Joint Stock is expected to under-perform the Sweetgreen. But the stock apears to be less risky and, when comparing its historical volatility, Joint Stock is 3.14 times less risky than Sweetgreen. The stock trades about -0.1 of its potential returns per unit of risk. The Sweetgreen is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 3,790 in Sweetgreen on September 13, 2024 and sell it today you would earn a total of 17.00 from holding Sweetgreen or generate 0.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Joint Stock vs. Sweetgreen
Performance |
| Timeline |
| Joint Stock |
| Sweetgreen |
Joint Stock and Sweetgreen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Joint Stock and Sweetgreen
The main advantage of trading using opposite Joint Stock and Sweetgreen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Joint Stock position performs unexpectedly, Sweetgreen 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 Sweetgreen will offset losses from the drop in Sweetgreen's long position.| Joint Stock vs. LB Foster | Joint Stock vs. Modine Manufacturing | Joint Stock vs. PACCAR Inc | Joint Stock vs. Afya |
| Sweetgreen vs. Cannae Holdings | Sweetgreen vs. Brinker International | Sweetgreen vs. Jack In The | Sweetgreen vs. Biglari Holdings |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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