Correlation Between 00206RGN6 and Shake Shack
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By analyzing existing cross correlation between T 655 15 JAN 28 and Shake Shack, you can compare the effects of market volatilities on 00206RGN6 and Shake Shack 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 00206RGN6 with a short position of Shake Shack. Check out your portfolio center. Please also check ongoing floating volatility patterns of 00206RGN6 and Shake Shack.
Diversification Opportunities for 00206RGN6 and Shake Shack
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 00206RGN6 and Shake is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding T 655 15 JAN 28 and Shake Shack in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shake Shack and 00206RGN6 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 T 655 15 JAN 28 are associated (or correlated) with Shake Shack. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shake Shack has no effect on the direction of 00206RGN6 i.e., 00206RGN6 and Shake Shack go up and down completely randomly.
Pair Corralation between 00206RGN6 and Shake Shack
Assuming the 90 days trading horizon 00206RGN6 is expected to generate 19.84 times less return on investment than Shake Shack. But when comparing it to its historical volatility, T 655 15 JAN 28 is 2.92 times less risky than Shake Shack. It trades about 0.02 of its potential returns per unit of risk. Shake Shack is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 10,466 in Shake Shack on August 28, 2024 and sell it today you would earn a total of 2,476 from holding Shake Shack or generate 23.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 62.5% |
| Values | Daily Returns |
T 655 15 JAN 28 vs. Shake Shack
Performance |
| Timeline |
| 00206RGN6 |
| Shake Shack |
00206RGN6 and Shake Shack Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 00206RGN6 and Shake Shack
The main advantage of trading using opposite 00206RGN6 and Shake Shack positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 00206RGN6 position performs unexpectedly, Shake Shack 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 Shake Shack will offset losses from the drop in Shake Shack's long position.| 00206RGN6 vs. Figs Inc | 00206RGN6 vs. Atmos Energy | 00206RGN6 vs. Burlington Stores | 00206RGN6 vs. Lakeland Industries |
| Shake Shack vs. Dominos Pizza | Shake Shack vs. Papa Johns International | Shake Shack vs. Chipotle Mexican Grill | Shake Shack vs. Darden Restaurants |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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