Correlation Between RCI Hospitality and GENERAL
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By analyzing existing cross correlation between RCI Hospitality Holdings and GENERAL ELEC CAP, you can compare the effects of market volatilities on RCI Hospitality and GENERAL 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 RCI Hospitality with a short position of GENERAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of RCI Hospitality and GENERAL.
Diversification Opportunities for RCI Hospitality and GENERAL
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between RCI and GENERAL is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding RCI Hospitality Holdings and GENERAL ELEC CAP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GENERAL ELEC CAP and RCI Hospitality 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 RCI Hospitality Holdings are associated (or correlated) with GENERAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GENERAL ELEC CAP has no effect on the direction of RCI Hospitality i.e., RCI Hospitality and GENERAL go up and down completely randomly.
Pair Corralation between RCI Hospitality and GENERAL
Given the investment horizon of 90 days RCI Hospitality Holdings is expected to generate 1.75 times more return on investment than GENERAL. However, RCI Hospitality is 1.75 times more volatile than GENERAL ELEC CAP. It trades about 0.3 of its potential returns per unit of risk. GENERAL ELEC CAP is currently generating about -0.16 per unit of risk. If you would invest 4,470 in RCI Hospitality Holdings on August 28, 2024 and sell it today you would earn a total of 851.00 from holding RCI Hospitality Holdings or generate 19.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 45.45% |
| Values | Daily Returns |
RCI Hospitality Holdings vs. GENERAL ELEC CAP
Performance |
| Timeline |
| RCI Hospitality Holdings |
| GENERAL ELEC CAP |
RCI Hospitality and GENERAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RCI Hospitality and GENERAL
The main advantage of trading using opposite RCI Hospitality and GENERAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RCI Hospitality position performs unexpectedly, GENERAL 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 GENERAL will offset losses from the drop in GENERAL's long position.| RCI Hospitality vs. Brinker International | RCI Hospitality vs. Bloomin Brands | RCI Hospitality vs. BJs Restaurants | RCI Hospitality vs. Dennys Corp |
| GENERAL vs. AEP TEX INC | GENERAL vs. US BANK NATIONAL | GENERAL vs. Eat Beyond Global | GENERAL vs. Charles Schwab 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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