Correlation Between BJs Restaurants and Jumbo SA
Can any of the company-specific risk be diversified away by investing in both BJs Restaurants and Jumbo SA 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 BJs Restaurants and Jumbo SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BJs Restaurants and Jumbo SA, you can compare the effects of market volatilities on BJs Restaurants and Jumbo SA 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 BJs Restaurants with a short position of Jumbo SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of BJs Restaurants and Jumbo SA.
Diversification Opportunities for BJs Restaurants and Jumbo SA
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between BJs and Jumbo is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding BJs Restaurants and Jumbo SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jumbo SA and BJs Restaurants 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 BJs Restaurants are associated (or correlated) with Jumbo SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jumbo SA has no effect on the direction of BJs Restaurants i.e., BJs Restaurants and Jumbo SA go up and down completely randomly.
Pair Corralation between BJs Restaurants and Jumbo SA
Assuming the 90 days trading horizon BJs Restaurants is expected to generate 1.35 times more return on investment than Jumbo SA. However, BJs Restaurants is 1.35 times more volatile than Jumbo SA. It trades about 0.12 of its potential returns per unit of risk. Jumbo SA is currently generating about 0.01 per unit of risk. If you would invest 2,880 in BJs Restaurants on August 25, 2024 and sell it today you would earn a total of 380.00 from holding BJs Restaurants or generate 13.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BJs Restaurants vs. Jumbo SA
Performance |
| Timeline |
| BJs Restaurants |
| Jumbo SA |
BJs Restaurants and Jumbo SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BJs Restaurants and Jumbo SA
The main advantage of trading using opposite BJs Restaurants and Jumbo SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BJs Restaurants position performs unexpectedly, Jumbo SA 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 Jumbo SA will offset losses from the drop in Jumbo SA's long position.| BJs Restaurants vs. Gladstone Investment | BJs Restaurants vs. Strategic Investments AS | BJs Restaurants vs. CDN IMPERIAL BANK | BJs Restaurants vs. HK Electric Investments |
| Jumbo SA vs. QUEEN S ROAD | Jumbo SA vs. BJs Restaurants | Jumbo SA vs. Texas Roadhouse | Jumbo SA vs. VARIOUS EATERIES LS |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |