Correlation Between Weyco and Kura Sushi
Can any of the company-specific risk be diversified away by investing in both Weyco and Kura Sushi 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 Weyco and Kura Sushi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Weyco Group and Kura Sushi USA, you can compare the effects of market volatilities on Weyco and Kura Sushi 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 Weyco with a short position of Kura Sushi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weyco and Kura Sushi.
Diversification Opportunities for Weyco and Kura Sushi
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Weyco and Kura is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Weyco Group and Kura Sushi USA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kura Sushi USA and Weyco 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 Weyco Group are associated (or correlated) with Kura Sushi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kura Sushi USA has no effect on the direction of Weyco i.e., Weyco and Kura Sushi go up and down completely randomly.
Pair Corralation between Weyco and Kura Sushi
Given the investment horizon of 90 days Weyco Group is expected to generate 1.04 times more return on investment than Kura Sushi. However, Weyco is 1.04 times more volatile than Kura Sushi USA. It trades about 0.06 of its potential returns per unit of risk. Kura Sushi USA is currently generating about 0.05 per unit of risk. If you would invest 3,414 in Weyco Group on August 30, 2024 and sell it today you would earn a total of 149.00 from holding Weyco Group or generate 4.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Weyco Group vs. Kura Sushi USA
Performance |
| Timeline |
| Weyco Group |
| Kura Sushi USA |
Weyco and Kura Sushi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Weyco and Kura Sushi
The main advantage of trading using opposite Weyco and Kura Sushi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weyco position performs unexpectedly, Kura Sushi 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 Kura Sushi will offset losses from the drop in Kura Sushi's long position.The idea behind Weyco Group and Kura Sushi USA 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.| Kura Sushi vs. Brinker International | Kura Sushi vs. Dennys Corp | Kura Sushi vs. Bloomin Brands | Kura Sushi vs. Jack In The |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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