Correlation Between Shake Shack and NATIONAL
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By analyzing existing cross correlation between Shake Shack and NATIONAL RURAL UTILS, you can compare the effects of market volatilities on Shake Shack and NATIONAL 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 NATIONAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shake Shack and NATIONAL.
Diversification Opportunities for Shake Shack and NATIONAL
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shake and NATIONAL is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Shake Shack and NATIONAL RURAL UTILS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NATIONAL RURAL UTILS 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 NATIONAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NATIONAL RURAL UTILS has no effect on the direction of Shake Shack i.e., Shake Shack and NATIONAL go up and down completely randomly.
Pair Corralation between Shake Shack and NATIONAL
Given the investment horizon of 90 days Shake Shack is expected to generate 13.56 times less return on investment than NATIONAL. But when comparing it to its historical volatility, Shake Shack is 20.38 times less risky than NATIONAL. It trades about 0.08 of its potential returns per unit of risk. NATIONAL RURAL UTILS is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 9,532 in NATIONAL RURAL UTILS on September 1, 2024 and sell it today you would lose (55.00) from holding NATIONAL RURAL UTILS or give up 0.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 82.26% |
| Values | Daily Returns |
Shake Shack vs. NATIONAL RURAL UTILS
Performance |
| Timeline |
| Shake Shack |
| NATIONAL RURAL UTILS |
Shake Shack and NATIONAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shake Shack and NATIONAL
The main advantage of trading using opposite Shake Shack and NATIONAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shake Shack position performs unexpectedly, NATIONAL 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 NATIONAL will offset losses from the drop in NATIONAL'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 |
| NATIONAL vs. Mesa Air Group | NATIONAL vs. Nexstar Broadcasting Group | NATIONAL vs. Afya | NATIONAL vs. Proficient Auto Logistics, |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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