Correlation Between Jack In and Biglari Holdings
Can any of the company-specific risk be diversified away by investing in both Jack In and Biglari Holdings 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 Jack In and Biglari Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jack In The and Biglari Holdings, you can compare the effects of market volatilities on Jack In and Biglari Holdings 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 Jack In with a short position of Biglari Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jack In and Biglari Holdings.
Diversification Opportunities for Jack In and Biglari Holdings
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Jack and Biglari is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Jack In The and Biglari Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biglari Holdings and Jack In 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 Jack In The are associated (or correlated) with Biglari Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biglari Holdings has no effect on the direction of Jack In i.e., Jack In and Biglari Holdings go up and down completely randomly.
Pair Corralation between Jack In and Biglari Holdings
Given the investment horizon of 90 days Jack In The is expected to under-perform the Biglari Holdings. In addition to that, Jack In is 1.03 times more volatile than Biglari Holdings. It trades about -0.27 of its total potential returns per unit of risk. Biglari Holdings is currently generating about 0.14 per unit of volatility. If you would invest 19,536 in Biglari Holdings on February 6, 2024 and sell it today you would earn a total of 858.00 from holding Biglari Holdings or generate 4.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jack In The vs. Biglari Holdings
Performance |
| Timeline |
| Jack In |
| Biglari Holdings |
Jack In and Biglari Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jack In and Biglari Holdings
The main advantage of trading using opposite Jack In and Biglari Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jack In position performs unexpectedly, Biglari Holdings 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 Biglari Holdings will offset losses from the drop in Biglari Holdings' long position.The idea behind Jack In The and Biglari Holdings 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.| Biglari Holdings vs. Microvast Holdings | Biglari Holdings vs. AEye Inc | Biglari Holdings vs. Bakkt Holdings Warrant |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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