Correlation Between Sweetgreen and Dave Busters
Can any of the company-specific risk be diversified away by investing in both Sweetgreen and Dave Busters 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 Dave Busters into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sweetgreen and Dave Busters Entertainment, you can compare the effects of market volatilities on Sweetgreen and Dave Busters 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 Dave Busters. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sweetgreen and Dave Busters.
Diversification Opportunities for Sweetgreen and Dave Busters
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sweetgreen and Dave is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Sweetgreen and Dave Busters Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dave Busters Enterta 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 Dave Busters. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dave Busters Enterta has no effect on the direction of Sweetgreen i.e., Sweetgreen and Dave Busters go up and down completely randomly.
Pair Corralation between Sweetgreen and Dave Busters
Allowing for the 90-day total investment horizon Sweetgreen is expected to generate 1.61 times more return on investment than Dave Busters. However, Sweetgreen is 1.61 times more volatile than Dave Busters Entertainment. It trades about 0.08 of its potential returns per unit of risk. Dave Busters Entertainment is currently generating about 0.02 per unit of risk. If you would invest 1,123 in Sweetgreen on August 28, 2024 and sell it today you would earn a total of 3,204 from holding Sweetgreen or generate 285.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sweetgreen vs. Dave Busters Entertainment
Performance |
| Timeline |
| Sweetgreen |
| Dave Busters Enterta |
Sweetgreen and Dave Busters Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sweetgreen and Dave Busters
The main advantage of trading using opposite Sweetgreen and Dave Busters positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sweetgreen position performs unexpectedly, Dave Busters 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 Dave Busters will offset losses from the drop in Dave Busters' long position.| Sweetgreen vs. Cannae Holdings | Sweetgreen vs. Brinker International | Sweetgreen vs. Jack In The | Sweetgreen vs. Biglari Holdings |
| Dave Busters vs. Imax Corp | Dave Busters vs. Marcus | Dave Busters vs. AMC Networks | Dave Busters vs. Cinemark Holdings |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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