Correlation Between Portillos and Chuys Holdings
Can any of the company-specific risk be diversified away by investing in both Portillos and Chuys 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 Portillos and Chuys Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Portillos and Chuys Holdings, you can compare the effects of market volatilities on Portillos and Chuys 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 Portillos with a short position of Chuys Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Portillos and Chuys Holdings.
Diversification Opportunities for Portillos and Chuys Holdings
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Portillos and Chuys is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Portillos and Chuys Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chuys Holdings and Portillos 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 Portillos are associated (or correlated) with Chuys Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chuys Holdings has no effect on the direction of Portillos i.e., Portillos and Chuys Holdings go up and down completely randomly.
Pair Corralation between Portillos and Chuys Holdings
Given the investment horizon of 90 days Portillos is expected to under-perform the Chuys Holdings. In addition to that, Portillos is 32.98 times more volatile than Chuys Holdings. It trades about -0.02 of its total potential returns per unit of risk. Chuys Holdings is currently generating about 0.36 per unit of volatility. If you would invest 3,719 in Chuys Holdings on August 31, 2024 and sell it today you would earn a total of 29.00 from holding Chuys Holdings or generate 0.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 46.03% |
| Values | Daily Returns |
Portillos vs. Chuys Holdings
Performance |
| Timeline |
| Portillos |
| Chuys Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Strong
Portillos and Chuys Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Portillos and Chuys Holdings
The main advantage of trading using opposite Portillos and Chuys Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Portillos position performs unexpectedly, Chuys 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 Chuys Holdings will offset losses from the drop in Chuys Holdings' long position.| Portillos vs. Wingstop | Portillos vs. The Wendys Co | Portillos vs. RLJ Lodging Trust | Portillos vs. Aquagold International |
| Chuys Holdings vs. Brinker International | Chuys Holdings vs. Bloomin Brands | Chuys Holdings vs. FAT Brands | Chuys Holdings vs. Potbelly Co |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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