Correlation Between NEXEN and Dennys Corp
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By analyzing existing cross correlation between NEXEN INC 64 and Dennys Corp, you can compare the effects of market volatilities on NEXEN and Dennys Corp 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 NEXEN with a short position of Dennys Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of NEXEN and Dennys Corp.
Diversification Opportunities for NEXEN and Dennys Corp
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between NEXEN and Dennys is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding NEXEN INC 64 and Dennys Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dennys Corp and NEXEN 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 NEXEN INC 64 are associated (or correlated) with Dennys Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dennys Corp has no effect on the direction of NEXEN i.e., NEXEN and Dennys Corp go up and down completely randomly.
Pair Corralation between NEXEN and Dennys Corp
Assuming the 90 days trading horizon NEXEN INC 64 is expected to generate 0.27 times more return on investment than Dennys Corp. However, NEXEN INC 64 is 3.76 times less risky than Dennys Corp. It trades about 0.14 of its potential returns per unit of risk. Dennys Corp is currently generating about -0.02 per unit of risk. If you would invest 11,246 in NEXEN INC 64 on August 30, 2024 and sell it today you would earn a total of 364.00 from holding NEXEN INC 64 or generate 3.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 19.84% |
| Values | Daily Returns |
NEXEN INC 64 vs. Dennys Corp
Performance |
| Timeline |
| NEXEN INC 64 |
| Dennys Corp |
NEXEN and Dennys Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NEXEN and Dennys Corp
The main advantage of trading using opposite NEXEN and Dennys Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NEXEN position performs unexpectedly, Dennys Corp 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 Dennys Corp will offset losses from the drop in Dennys Corp's long position.The idea behind NEXEN INC 64 and Dennys Corp 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.| Dennys Corp vs. Chipotle Mexican Grill | Dennys Corp vs. Yum Brands | Dennys Corp vs. The Wendys Co | Dennys Corp vs. McDonalds |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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