Correlation Between Sweetgreen and Pinstripes Holdings
Can any of the company-specific risk be diversified away by investing in both Sweetgreen and Pinstripes Holdings 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 Pinstripes Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sweetgreen and Pinstripes Holdings, you can compare the effects of market volatilities on Sweetgreen and Pinstripes Holdings 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 Pinstripes Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sweetgreen and Pinstripes Holdings.
Diversification Opportunities for Sweetgreen and Pinstripes Holdings
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sweetgreen and Pinstripes is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Sweetgreen and Pinstripes Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pinstripes Holdings 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 Pinstripes Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pinstripes Holdings has no effect on the direction of Sweetgreen i.e., Sweetgreen and Pinstripes Holdings go up and down completely randomly.
Pair Corralation between Sweetgreen and Pinstripes Holdings
Allowing for the 90-day total investment horizon Sweetgreen is expected to generate 0.65 times more return on investment than Pinstripes Holdings. However, Sweetgreen is 1.53 times less risky than Pinstripes Holdings. It trades about 0.04 of its potential returns per unit of risk. Pinstripes Holdings is currently generating about -0.14 per unit of risk. If you would invest 2,641 in Sweetgreen on October 26, 2024 and sell it today you would earn a total of 263.50 from holding Sweetgreen or generate 9.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.19% |
| Values | Daily Returns |
Sweetgreen vs. Pinstripes Holdings
Performance |
| Timeline |
| Sweetgreen |
| Pinstripes Holdings |
Sweetgreen and Pinstripes Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sweetgreen and Pinstripes Holdings
The main advantage of trading using opposite Sweetgreen and Pinstripes Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sweetgreen position performs unexpectedly, Pinstripes Holdings 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 Pinstripes Holdings will offset losses from the drop in Pinstripes Holdings' long position.| Sweetgreen vs. Cannae Holdings | Sweetgreen vs. Brinker International | Sweetgreen vs. Jack In The | Sweetgreen vs. Biglari Holdings |
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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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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