Correlation Between Wendys and International Game
Can any of the company-specific risk be diversified away by investing in both Wendys and International Game 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 Wendys and International Game into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Wendys Co and International Game Technology, you can compare the effects of market volatilities on Wendys and International Game 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 Wendys with a short position of International Game. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wendys and International Game.
Diversification Opportunities for Wendys and International Game
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Wendys and International is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding The Wendys Co and International Game Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Game and Wendys 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 The Wendys Co are associated (or correlated) with International Game. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Game has no effect on the direction of Wendys i.e., Wendys and International Game go up and down completely randomly.
Pair Corralation between Wendys and International Game
Considering the 90-day investment horizon The Wendys Co is expected to under-perform the International Game. In addition to that, Wendys is 1.14 times more volatile than International Game Technology. It trades about -0.29 of its total potential returns per unit of risk. International Game Technology is currently generating about -0.24 per unit of volatility. If you would invest 2,111 in International Game Technology on August 27, 2024 and sell it today you would lose (185.00) from holding International Game Technology or give up 8.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Wendys Co vs. International Game Technology
Performance |
| Timeline |
| The Wendys |
| International Game |
Wendys and International Game Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wendys and International Game
The main advantage of trading using opposite Wendys and International Game positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wendys position performs unexpectedly, International Game 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 International Game will offset losses from the drop in International Game's long position.| Wendys vs. Yum Brands | Wendys vs. Dominos Pizza | Wendys vs. Darden Restaurants | Wendys vs. Papa Johns International |
| International Game vs. Accel Entertainment | International Game vs. PlayAGS | International Game vs. Everi Holdings | International Game vs. Light Wonder |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |