Correlation Between Shake Shack and Jack In
Can any of the company-specific risk be diversified away by investing in both Shake Shack and Jack In 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 Shake Shack and Jack In into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shake Shack and Jack In The, you can compare the effects of market volatilities on Shake Shack and Jack In 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 Shake Shack with a short position of Jack In. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shake Shack and Jack In.
Diversification Opportunities for Shake Shack and Jack In
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shake and Jack is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Shake Shack and Jack In The in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jack In and Shake Shack 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 Shake Shack are associated (or correlated) with Jack In. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jack In has no effect on the direction of Shake Shack i.e., Shake Shack and Jack In go up and down completely randomly.
Pair Corralation between Shake Shack and Jack In
Given the investment horizon of 90 days Shake Shack is expected to generate 1.14 times more return on investment than Jack In. However, Shake Shack is 1.14 times more volatile than Jack In The. It trades about 0.22 of its potential returns per unit of risk. Jack In The is currently generating about -0.09 per unit of risk. If you would invest 11,426 in Shake Shack on August 28, 2024 and sell it today you would earn a total of 1,516 from holding Shake Shack or generate 13.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shake Shack vs. Jack In The
Performance |
| Timeline |
| Shake Shack |
| Jack In |
Shake Shack and Jack In Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shake Shack and Jack In
The main advantage of trading using opposite Shake Shack and Jack In positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shake Shack position performs unexpectedly, Jack In 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 Jack In will offset losses from the drop in Jack In's long position.| Shake Shack vs. Dominos Pizza | Shake Shack vs. Papa Johns International | Shake Shack vs. Chipotle Mexican Grill | Shake Shack vs. Darden Restaurants |
| Jack In vs. Dine Brands Global | Jack In vs. Bloomin Brands | Jack In vs. BJs Restaurants | Jack In vs. The Cheesecake Factory |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity |