Correlation Between Sweetgreen and Topbuild Corp
Can any of the company-specific risk be diversified away by investing in both Sweetgreen and Topbuild Corp 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 Sweetgreen and Topbuild Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sweetgreen and Topbuild Corp, you can compare the effects of market volatilities on Sweetgreen and Topbuild Corp 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 Sweetgreen with a short position of Topbuild Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sweetgreen and Topbuild Corp.
Diversification Opportunities for Sweetgreen and Topbuild Corp
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Sweetgreen and Topbuild is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Sweetgreen and Topbuild Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Topbuild Corp and Sweetgreen 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 Sweetgreen are associated (or correlated) with Topbuild Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Topbuild Corp has no effect on the direction of Sweetgreen i.e., Sweetgreen and Topbuild Corp go up and down completely randomly.
Pair Corralation between Sweetgreen and Topbuild Corp
Allowing for the 90-day total investment horizon Sweetgreen is expected to generate 1.99 times more return on investment than Topbuild Corp. However, Sweetgreen is 1.99 times more volatile than Topbuild Corp. It trades about 0.1 of its potential returns per unit of risk. Topbuild Corp is currently generating about 0.07 per unit of risk. If you would invest 1,092 in Sweetgreen on August 31, 2024 and sell it today you would earn a total of 3,006 from holding Sweetgreen or generate 275.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sweetgreen vs. Topbuild Corp
Performance |
| Timeline |
| Sweetgreen |
| Topbuild Corp |
Sweetgreen and Topbuild Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sweetgreen and Topbuild Corp
The main advantage of trading using opposite Sweetgreen and Topbuild Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sweetgreen position performs unexpectedly, Topbuild Corp 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 Topbuild Corp will offset losses from the drop in Topbuild Corp's long position.| Sweetgreen vs. Cannae Holdings | Sweetgreen vs. Brinker International | Sweetgreen vs. Jack In The | Sweetgreen vs. Biglari Holdings |
| Topbuild Corp vs. Api Group Corp | Topbuild Corp vs. MYR Group | Topbuild Corp vs. Comfort Systems USA | Topbuild Corp vs. Construction Partners |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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