Correlation Between Pinstripes Holdings and Bloomin Brands
Can any of the company-specific risk be diversified away by investing in both Pinstripes Holdings and Bloomin Brands 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 Pinstripes Holdings and Bloomin Brands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pinstripes Holdings and Bloomin Brands, you can compare the effects of market volatilities on Pinstripes Holdings and Bloomin Brands 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 Pinstripes Holdings with a short position of Bloomin Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pinstripes Holdings and Bloomin Brands.
Diversification Opportunities for Pinstripes Holdings and Bloomin Brands
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Pinstripes and Bloomin is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Pinstripes Holdings and Bloomin Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bloomin Brands and Pinstripes Holdings 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 Pinstripes Holdings are associated (or correlated) with Bloomin Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bloomin Brands has no effect on the direction of Pinstripes Holdings i.e., Pinstripes Holdings and Bloomin Brands go up and down completely randomly.
Pair Corralation between Pinstripes Holdings and Bloomin Brands
Given the investment horizon of 90 days Pinstripes Holdings is expected to generate 1.54 times more return on investment than Bloomin Brands. However, Pinstripes Holdings is 1.54 times more volatile than Bloomin Brands. It trades about 0.05 of its potential returns per unit of risk. Bloomin Brands is currently generating about -0.16 per unit of risk. If you would invest 95.00 in Pinstripes Holdings on August 27, 2024 and sell it today you would earn a total of 3.00 from holding Pinstripes Holdings or generate 3.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pinstripes Holdings vs. Bloomin Brands
Performance |
| Timeline |
| Pinstripes Holdings |
| Bloomin Brands |
Pinstripes Holdings and Bloomin Brands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pinstripes Holdings and Bloomin Brands
The main advantage of trading using opposite Pinstripes Holdings and Bloomin Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pinstripes Holdings position performs unexpectedly, Bloomin Brands 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 Bloomin Brands will offset losses from the drop in Bloomin Brands' long position.| Pinstripes Holdings vs. MGIC Investment Corp | Pinstripes Holdings vs. Highway Holdings Limited | Pinstripes Holdings vs. Flexible Solutions International | Pinstripes Holdings vs. Summit Materials |
| Bloomin Brands vs. Dine Brands Global | Bloomin Brands vs. BJs Restaurants | Bloomin Brands vs. The Cheesecake Factory | Bloomin Brands vs. Brinker International |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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