Correlation Between Turning Point and CAVA Group,

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Can any of the company-specific risk be diversified away by investing in both Turning Point and CAVA Group, 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 Turning Point and CAVA Group, into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Turning Point Brands and CAVA Group,, you can compare the effects of market volatilities on Turning Point and CAVA Group, 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 Turning Point with a short position of CAVA Group,. Check out your portfolio center. Please also check ongoing floating volatility patterns of Turning Point and CAVA Group,.

Diversification Opportunities for Turning Point and CAVA Group,

0.77
  Correlation Coefficient

Poor diversification

The 3 months correlation between Turning and CAVA is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Turning Point Brands and CAVA Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CAVA Group, and Turning Point 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 Turning Point Brands are associated (or correlated) with CAVA Group,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CAVA Group, has no effect on the direction of Turning Point i.e., Turning Point and CAVA Group, go up and down completely randomly.

Pair Corralation between Turning Point and CAVA Group,

Considering the 90-day investment horizon Turning Point Brands is expected to generate 0.63 times more return on investment than CAVA Group,. However, Turning Point Brands is 1.59 times less risky than CAVA Group,. It trades about 0.42 of its potential returns per unit of risk. CAVA Group, is currently generating about -0.18 per unit of risk. If you would invest  5,250  in Turning Point Brands on September 12, 2024 and sell it today you would earn a total of  1,138  from holding Turning Point Brands or generate 21.68% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Turning Point Brands  vs.  CAVA Group,

 Performance 
       Timeline  
Turning Point Brands 

Risk-Adjusted Performance

29 of 100

 
Weak
 
Strong
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Turning Point Brands are ranked lower than 29 (%) of all global equities and portfolios over the last 90 days. Despite somewhat abnormal basic indicators, Turning Point sustained solid returns over the last few months and may actually be approaching a breakup point.
CAVA Group, 

Risk-Adjusted Performance

1 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in CAVA Group, are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, CAVA Group, is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Turning Point and CAVA Group, Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Turning Point and CAVA Group,

The main advantage of trading using opposite Turning Point and CAVA Group, positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Turning Point position performs unexpectedly, CAVA Group, 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 CAVA Group, will offset losses from the drop in CAVA Group,'s long position.
The idea behind Turning Point Brands and CAVA Group, pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.

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