Correlation Between Rave Restaurant and High Roller
Can any of the company-specific risk be diversified away by investing in both Rave Restaurant and High Roller 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 Rave Restaurant and High Roller into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rave Restaurant Group and High Roller Technologies,, you can compare the effects of market volatilities on Rave Restaurant and High Roller 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 Rave Restaurant with a short position of High Roller. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rave Restaurant and High Roller.
Diversification Opportunities for Rave Restaurant and High Roller
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Rave and High is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Rave Restaurant Group and High Roller Technologies, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on High Roller Technologies, and Rave Restaurant 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 Rave Restaurant Group are associated (or correlated) with High Roller. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of High Roller Technologies, has no effect on the direction of Rave Restaurant i.e., Rave Restaurant and High Roller go up and down completely randomly.
Pair Corralation between Rave Restaurant and High Roller
Given the investment horizon of 90 days Rave Restaurant Group is expected to generate 0.58 times more return on investment than High Roller. However, Rave Restaurant Group is 1.72 times less risky than High Roller. It trades about 0.22 of its potential returns per unit of risk. High Roller Technologies, is currently generating about -0.01 per unit of risk. If you would invest 172.00 in Rave Restaurant Group on September 12, 2024 and sell it today you would earn a total of 129.00 from holding Rave Restaurant Group or generate 75.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 54.69% |
| Values | Daily Returns |
Rave Restaurant Group vs. High Roller Technologies,
Performance |
| Timeline |
| Rave Restaurant Group |
| High Roller Technologies, |
Rave Restaurant and High Roller Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rave Restaurant and High Roller
The main advantage of trading using opposite Rave Restaurant and High Roller positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rave Restaurant position performs unexpectedly, High Roller 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 High Roller will offset losses from the drop in High Roller's long position.| Rave Restaurant vs. Ark Restaurants Corp | Rave Restaurant vs. One Group Hospitality | Rave Restaurant vs. Flanigans Enterprises | Rave Restaurant vs. Noble Romans |
| High Roller vs. Corporacion America Airports | High Roller vs. GE Vernova LLC | High Roller vs. Atmos Energy | High Roller vs. Porvair plc |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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