Correlation Between Nathans Famous and Alsea SAB
Can any of the company-specific risk be diversified away by investing in both Nathans Famous and Alsea SAB 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 Nathans Famous and Alsea SAB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nathans Famous and Alsea SAB de, you can compare the effects of market volatilities on Nathans Famous and Alsea SAB 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 Nathans Famous with a short position of Alsea SAB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nathans Famous and Alsea SAB.
Diversification Opportunities for Nathans Famous and Alsea SAB
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Nathans and Alsea is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Nathans Famous and Alsea SAB de in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alsea SAB de and Nathans Famous 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 Nathans Famous are associated (or correlated) with Alsea SAB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alsea SAB de has no effect on the direction of Nathans Famous i.e., Nathans Famous and Alsea SAB go up and down completely randomly.
Pair Corralation between Nathans Famous and Alsea SAB
Given the investment horizon of 90 days Nathans Famous is expected to generate 0.46 times more return on investment than Alsea SAB. However, Nathans Famous is 2.17 times less risky than Alsea SAB. It trades about 0.11 of its potential returns per unit of risk. Alsea SAB de is currently generating about -0.1 per unit of risk. If you would invest 6,767 in Nathans Famous on August 28, 2024 and sell it today you would earn a total of 1,692 from holding Nathans Famous or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nathans Famous vs. Alsea SAB de
Performance |
| Timeline |
| Nathans Famous |
| Alsea SAB de |
Nathans Famous and Alsea SAB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nathans Famous and Alsea SAB
The main advantage of trading using opposite Nathans Famous and Alsea SAB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nathans Famous position performs unexpectedly, Alsea SAB 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 Alsea SAB will offset losses from the drop in Alsea SAB's long position.| Nathans Famous vs. Noble Romans | Nathans Famous vs. Good Times Restaurants | Nathans Famous vs. Bagger Daves Burger | Nathans Famous vs. Flanigans Enterprises |
| Alsea SAB vs. Marstons PLC | Alsea SAB vs. Bagger Daves Burger | Alsea SAB vs. Flanigans Enterprises | Alsea SAB vs. Ark Restaurants Corp |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |