Correlation Between BJs Restaurants and Amkor Technology
Can any of the company-specific risk be diversified away by investing in both BJs Restaurants and Amkor Technology 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 Amkor Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BJs Restaurants and Amkor Technology, you can compare the effects of market volatilities on BJs Restaurants and Amkor Technology 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 Amkor Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of BJs Restaurants and Amkor Technology.
Diversification Opportunities for BJs Restaurants and Amkor Technology
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between BJs and Amkor is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding BJs Restaurants and Amkor Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amkor Technology 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 Amkor Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amkor Technology has no effect on the direction of BJs Restaurants i.e., BJs Restaurants and Amkor Technology go up and down completely randomly.
Pair Corralation between BJs Restaurants and Amkor Technology
Assuming the 90 days trading horizon BJs Restaurants is expected to generate 1.08 times more return on investment than Amkor Technology. However, BJs Restaurants is 1.08 times more volatile than Amkor Technology. It trades about -0.04 of its potential returns per unit of risk. Amkor Technology is currently generating about -0.09 per unit of risk. If you would invest 3,400 in BJs Restaurants on October 28, 2024 and sell it today you would lose (60.00) from holding BJs Restaurants or give up 1.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BJs Restaurants vs. Amkor Technology
Performance |
| Timeline |
| BJs Restaurants |
| Amkor Technology |
BJs Restaurants and Amkor Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BJs Restaurants and Amkor Technology
The main advantage of trading using opposite BJs Restaurants and Amkor Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BJs Restaurants position performs unexpectedly, Amkor Technology 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 Amkor Technology will offset losses from the drop in Amkor Technology's long position.| BJs Restaurants vs. Apple Inc | BJs Restaurants vs. Apple Inc | BJs Restaurants vs. Apple Inc | BJs Restaurants vs. Apple Inc |
| Amkor Technology vs. NVIDIA | Amkor Technology vs. Taiwan Semiconductor Manufacturing | Amkor Technology vs. Broadcom | Amkor Technology vs. QUALCOMM Incorporated |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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