Correlation Between Wingstop and Cheetah Net
Can any of the company-specific risk be diversified away by investing in both Wingstop and Cheetah Net 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 Wingstop and Cheetah Net into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wingstop and Cheetah Net Supply, you can compare the effects of market volatilities on Wingstop and Cheetah Net 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 Wingstop with a short position of Cheetah Net. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wingstop and Cheetah Net.
Diversification Opportunities for Wingstop and Cheetah Net
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Wingstop and Cheetah is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Wingstop and Cheetah Net Supply in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cheetah Net Supply and Wingstop 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 Wingstop are associated (or correlated) with Cheetah Net. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cheetah Net Supply has no effect on the direction of Wingstop i.e., Wingstop and Cheetah Net go up and down completely randomly.
Pair Corralation between Wingstop and Cheetah Net
Given the investment horizon of 90 days Wingstop is expected to generate 0.41 times more return on investment than Cheetah Net. However, Wingstop is 2.44 times less risky than Cheetah Net. It trades about -0.04 of its potential returns per unit of risk. Cheetah Net Supply is currently generating about -0.07 per unit of risk. If you would invest 37,259 in Wingstop on September 3, 2024 and sell it today you would lose (4,382) from holding Wingstop or give up 11.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wingstop vs. Cheetah Net Supply
Performance |
| Timeline |
| Wingstop |
| Cheetah Net Supply |
Wingstop and Cheetah Net Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wingstop and Cheetah Net
The main advantage of trading using opposite Wingstop and Cheetah Net positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wingstop position performs unexpectedly, Cheetah Net 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 Cheetah Net will offset losses from the drop in Cheetah Net's long position.| Wingstop vs. Highway Holdings Limited | Wingstop vs. QCR Holdings | Wingstop vs. Partner Communications | Wingstop vs. Acumen Pharmaceuticals |
| Cheetah Net vs. Tyson Foods | Cheetah Net vs. Mills Music Trust | Cheetah Net vs. Cumberland Pharmaceuticals | Cheetah Net vs. The Joint Corp |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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