Correlation Between Ruths Hospitality and Flanigans Enterprises
Can any of the company-specific risk be diversified away by investing in both Ruths Hospitality and Flanigans Enterprises 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 Ruths Hospitality and Flanigans Enterprises into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ruths Hospitality Group and Flanigans Enterprises, you can compare the effects of market volatilities on Ruths Hospitality and Flanigans Enterprises 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 Ruths Hospitality with a short position of Flanigans Enterprises. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ruths Hospitality and Flanigans Enterprises.
Diversification Opportunities for Ruths Hospitality and Flanigans Enterprises
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ruths and Flanigans is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Ruths Hospitality Group and Flanigans Enterprises in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Flanigans Enterprises and Ruths 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 Ruths Hospitality Group are associated (or correlated) with Flanigans Enterprises. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Flanigans Enterprises has no effect on the direction of Ruths Hospitality i.e., Ruths Hospitality and Flanigans Enterprises go up and down completely randomly.
Pair Corralation between Ruths Hospitality and Flanigans Enterprises
If you would invest 2,149 in Ruths Hospitality Group on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Ruths Hospitality Group or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 5.0% |
| Values | Daily Returns |
Ruths Hospitality Group vs. Flanigans Enterprises
Performance |
| Timeline |
| Ruths Hospitality |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Flanigans Enterprises |
Ruths Hospitality and Flanigans Enterprises Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ruths Hospitality and Flanigans Enterprises
The main advantage of trading using opposite Ruths Hospitality and Flanigans Enterprises positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ruths Hospitality position performs unexpectedly, Flanigans Enterprises 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 Flanigans Enterprises will offset losses from the drop in Flanigans Enterprises' long position.| Ruths Hospitality vs. Dine Brands Global | Ruths Hospitality vs. Bloomin Brands | Ruths Hospitality vs. BJs Restaurants | Ruths Hospitality vs. The Cheesecake Factory |
| Flanigans Enterprises vs. FAT Brands | Flanigans Enterprises vs. Potbelly Co | Flanigans Enterprises vs. BJs Restaurants | Flanigans Enterprises vs. One Group Hospitality |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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