Correlation Between BJs Restaurants and Tokyu Construction
Can any of the company-specific risk be diversified away by investing in both BJs Restaurants and Tokyu Construction 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 Tokyu Construction into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BJs Restaurants and Tokyu Construction Co, you can compare the effects of market volatilities on BJs Restaurants and Tokyu Construction 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 Tokyu Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of BJs Restaurants and Tokyu Construction.
Diversification Opportunities for BJs Restaurants and Tokyu Construction
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between BJs and Tokyu is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding BJs Restaurants and Tokyu Construction Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tokyu Construction 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 Tokyu Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tokyu Construction has no effect on the direction of BJs Restaurants i.e., BJs Restaurants and Tokyu Construction go up and down completely randomly.
Pair Corralation between BJs Restaurants and Tokyu Construction
Assuming the 90 days trading horizon BJs Restaurants is expected to under-perform the Tokyu Construction. In addition to that, BJs Restaurants is 2.27 times more volatile than Tokyu Construction Co. It trades about -0.04 of its total potential returns per unit of risk. Tokyu Construction Co is currently generating about 0.0 per unit of volatility. If you would invest 426.00 in Tokyu Construction Co on October 28, 2024 and sell it today you would earn a total of 0.00 from holding Tokyu Construction Co or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BJs Restaurants vs. Tokyu Construction Co
Performance |
| Timeline |
| BJs Restaurants |
| Tokyu Construction |
BJs Restaurants and Tokyu Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BJs Restaurants and Tokyu Construction
The main advantage of trading using opposite BJs Restaurants and Tokyu Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BJs Restaurants position performs unexpectedly, Tokyu Construction 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 Tokyu Construction will offset losses from the drop in Tokyu Construction's long position.| BJs Restaurants vs. Apple Inc | BJs Restaurants vs. Apple Inc | BJs Restaurants vs. Apple Inc | BJs Restaurants vs. Apple Inc |
| Tokyu Construction vs. Prosiebensat 1 Media | Tokyu Construction vs. PROSIEBENSAT1 MEDIADR4 | Tokyu Construction vs. Townsquare Media | Tokyu Construction vs. Penn National Gaming |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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