Correlation Between Dunkin Brands and Summit Materials
Can any of the company-specific risk be diversified away by investing in both Dunkin Brands and Summit Materials 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 Dunkin Brands and Summit Materials into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dunkin Brands Group and Summit Materials, you can compare the effects of market volatilities on Dunkin Brands and Summit Materials 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 Dunkin Brands with a short position of Summit Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunkin Brands and Summit Materials.
Diversification Opportunities for Dunkin Brands and Summit Materials
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Dunkin and Summit is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Dunkin Brands Group and Summit Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Summit Materials and Dunkin Brands 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 Dunkin Brands Group are associated (or correlated) with Summit Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Summit Materials has no effect on the direction of Dunkin Brands i.e., Dunkin Brands and Summit Materials go up and down completely randomly.
Pair Corralation between Dunkin Brands and Summit Materials
If you would invest (100.00) in Dunkin Brands Group on January 26, 2024 and sell it today you would earn a total of 100.00 from holding Dunkin Brands Group or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Dunkin Brands Group vs. Summit Materials
Performance |
| Timeline |
| Dunkin Brands Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Summit Materials |
Dunkin Brands and Summit Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dunkin Brands and Summit Materials
The main advantage of trading using opposite Dunkin Brands and Summit Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunkin Brands position performs unexpectedly, Summit Materials 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 Summit Materials will offset losses from the drop in Summit Materials' long position.| Dunkin Brands vs. Procter Gamble | Dunkin Brands vs. United Guardian | Dunkin Brands vs. Compania Cervecerias Unidas | Dunkin Brands vs. JD Sports Fashion |
| Summit Materials vs. Eagle Materials | Summit Materials vs. CRH PLC ADR | Summit Materials vs. Cemex SAB de | Summit Materials vs. James Hardie Industries |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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