Correlation Between Shake Shack and 25746UCZ0
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By analyzing existing cross correlation between Shake Shack and US25746UCZ03, you can compare the effects of market volatilities on Shake Shack and 25746UCZ0 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 25746UCZ0. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shake Shack and 25746UCZ0.
Diversification Opportunities for Shake Shack and 25746UCZ0
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Shake and 25746UCZ0 is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Shake Shack and US25746UCZ03 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on US25746UCZ03 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 25746UCZ0. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of US25746UCZ03 has no effect on the direction of Shake Shack i.e., Shake Shack and 25746UCZ0 go up and down completely randomly.
Pair Corralation between Shake Shack and 25746UCZ0
Given the investment horizon of 90 days Shake Shack is expected to generate 1.32 times more return on investment than 25746UCZ0. However, Shake Shack is 1.32 times more volatile than US25746UCZ03. It trades about 0.11 of its potential returns per unit of risk. US25746UCZ03 is currently generating about 0.04 per unit of risk. If you would invest 6,683 in Shake Shack on September 4, 2024 and sell it today you would earn a total of 6,551 from holding Shake Shack or generate 98.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 41.7% |
| Values | Daily Returns |
Shake Shack vs. US25746UCZ03
Performance |
| Timeline |
| Shake Shack |
| US25746UCZ03 |
Shake Shack and 25746UCZ0 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shake Shack and 25746UCZ0
The main advantage of trading using opposite Shake Shack and 25746UCZ0 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shake Shack position performs unexpectedly, 25746UCZ0 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 25746UCZ0 will offset losses from the drop in 25746UCZ0's long position.| Shake Shack vs. Hyatt Hotels | Shake Shack vs. Smart Share Global | Shake Shack vs. Sweetgreen | Shake Shack vs. Wyndham Hotels Resorts |
| 25746UCZ0 vs. Postal Realty Trust | 25746UCZ0 vs. Femasys | 25746UCZ0 vs. Toro Co | 25746UCZ0 vs. Meiwu Technology Co |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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