Correlation Between Sweetgreen and Freedom Bank
Can any of the company-specific risk be diversified away by investing in both Sweetgreen and Freedom Bank 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 Freedom Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sweetgreen and Freedom Bank of, you can compare the effects of market volatilities on Sweetgreen and Freedom Bank 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 Freedom Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sweetgreen and Freedom Bank.
Diversification Opportunities for Sweetgreen and Freedom Bank
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sweetgreen and Freedom is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Sweetgreen and Freedom Bank of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Freedom Bank 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 Freedom Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Freedom Bank has no effect on the direction of Sweetgreen i.e., Sweetgreen and Freedom Bank go up and down completely randomly.
Pair Corralation between Sweetgreen and Freedom Bank
Allowing for the 90-day total investment horizon Sweetgreen is expected to generate 3.74 times more return on investment than Freedom Bank. However, Sweetgreen is 3.74 times more volatile than Freedom Bank of. It trades about 0.09 of its potential returns per unit of risk. Freedom Bank of is currently generating about -0.06 per unit of risk. If you would invest 1,102 in Sweetgreen on August 27, 2024 and sell it today you would earn a total of 3,238 from holding Sweetgreen or generate 293.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 80.44% |
| Values | Daily Returns |
Sweetgreen vs. Freedom Bank of
Performance |
| Timeline |
| Sweetgreen |
| Freedom Bank |
Sweetgreen and Freedom Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sweetgreen and Freedom Bank
The main advantage of trading using opposite Sweetgreen and Freedom Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sweetgreen position performs unexpectedly, Freedom Bank 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 Freedom Bank will offset losses from the drop in Freedom Bank's long position.| Sweetgreen vs. Cannae Holdings | Sweetgreen vs. Brinker International | Sweetgreen vs. Jack In The | Sweetgreen vs. Biglari Holdings |
| Freedom Bank vs. Washington Business Bank | Freedom Bank vs. National Capital Bank | Freedom Bank vs. Community Heritage Financial | Freedom Bank vs. Citizens Financial 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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