Correlation Between Dave Busters and GEN Restaurant
Can any of the company-specific risk be diversified away by investing in both Dave Busters and GEN Restaurant 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 Dave Busters and GEN Restaurant into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dave Busters Entertainment and GEN Restaurant Group,, you can compare the effects of market volatilities on Dave Busters and GEN Restaurant 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 Dave Busters with a short position of GEN Restaurant. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dave Busters and GEN Restaurant.
Diversification Opportunities for Dave Busters and GEN Restaurant
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Dave and GEN is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Dave Busters Entertainment and GEN Restaurant Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GEN Restaurant Group, and Dave Busters 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 Dave Busters Entertainment are associated (or correlated) with GEN Restaurant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GEN Restaurant Group, has no effect on the direction of Dave Busters i.e., Dave Busters and GEN Restaurant go up and down completely randomly.
Pair Corralation between Dave Busters and GEN Restaurant
Given the investment horizon of 90 days Dave Busters is expected to generate 1.56 times less return on investment than GEN Restaurant. But when comparing it to its historical volatility, Dave Busters Entertainment is 1.45 times less risky than GEN Restaurant. It trades about 0.01 of its potential returns per unit of risk. GEN Restaurant Group, is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 862.00 in GEN Restaurant Group, on August 26, 2024 and sell it today you would lose (85.00) from holding GEN Restaurant Group, or give up 9.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dave Busters Entertainment vs. GEN Restaurant Group,
Performance |
| Timeline |
| Dave Busters Enterta |
| GEN Restaurant Group, |
Dave Busters and GEN Restaurant Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dave Busters and GEN Restaurant
The main advantage of trading using opposite Dave Busters and GEN Restaurant positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dave Busters position performs unexpectedly, GEN Restaurant 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 GEN Restaurant will offset losses from the drop in GEN Restaurant's long position.| Dave Busters vs. Imax Corp | Dave Busters vs. Marcus | Dave Busters vs. AMC Networks | Dave Busters vs. Cinemark Holdings |
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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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