Correlation Between MasterBrand and Pinstripes Holdings
Can any of the company-specific risk be diversified away by investing in both MasterBrand and Pinstripes Holdings 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 MasterBrand and Pinstripes Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MasterBrand and Pinstripes Holdings, you can compare the effects of market volatilities on MasterBrand and Pinstripes Holdings 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 MasterBrand with a short position of Pinstripes Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of MasterBrand and Pinstripes Holdings.
Diversification Opportunities for MasterBrand and Pinstripes Holdings
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between MasterBrand and Pinstripes is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding MasterBrand and Pinstripes Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pinstripes Holdings and MasterBrand 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 MasterBrand are associated (or correlated) with Pinstripes Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pinstripes Holdings has no effect on the direction of MasterBrand i.e., MasterBrand and Pinstripes Holdings go up and down completely randomly.
Pair Corralation between MasterBrand and Pinstripes Holdings
Considering the 90-day investment horizon MasterBrand is expected to under-perform the Pinstripes Holdings. But the stock apears to be less risky and, when comparing its historical volatility, MasterBrand is 3.3 times less risky than Pinstripes Holdings. The stock trades about -0.09 of its potential returns per unit of risk. The Pinstripes Holdings is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 80.00 in Pinstripes Holdings on August 30, 2024 and sell it today you would lose (3.00) from holding Pinstripes Holdings or give up 3.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MasterBrand vs. Pinstripes Holdings
Performance |
| Timeline |
| MasterBrand |
| Pinstripes Holdings |
MasterBrand and Pinstripes Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MasterBrand and Pinstripes Holdings
The main advantage of trading using opposite MasterBrand and Pinstripes Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MasterBrand position performs unexpectedly, Pinstripes Holdings 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 Pinstripes Holdings will offset losses from the drop in Pinstripes Holdings' long position.| MasterBrand vs. Bassett Furniture Industries | MasterBrand vs. Ethan Allen Interiors | MasterBrand vs. Natuzzi SpA | MasterBrand vs. Flexsteel Industries |
| Pinstripes Holdings vs. Chipotle Mexican Grill | Pinstripes Holdings vs. Yum Brands | Pinstripes Holdings vs. The Wendys Co | Pinstripes Holdings vs. McDonalds |
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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