Correlation Between BBQ Holdings and Loews Corp

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Can any of the company-specific risk be diversified away by investing in both BBQ Holdings and Loews Corp 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 BBQ Holdings and Loews Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BBQ Holdings and Loews Corp, you can compare the effects of market volatilities on BBQ Holdings and Loews Corp 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 BBQ Holdings with a short position of Loews Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of BBQ Holdings and Loews Corp.

Diversification Opportunities for BBQ Holdings and Loews Corp

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between BBQ and Loews is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding BBQ Holdings and Loews Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loews Corp and BBQ Holdings 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 BBQ Holdings are associated (or correlated) with Loews Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loews Corp has no effect on the direction of BBQ Holdings i.e., BBQ Holdings and Loews Corp go up and down completely randomly.

Pair Corralation between BBQ Holdings and Loews Corp

If you would invest  1,724  in BBQ Holdings on January 17, 2024 and sell it today you would earn a total of  0.00  from holding BBQ Holdings or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy4.76%
ValuesDaily Returns

BBQ Holdings  vs.  Loews Corp

 Performance 
       Timeline  
BBQ Holdings 

Risk-Adjusted Performance

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Over the last 90 days BBQ Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable fundamental drivers, BBQ Holdings is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.
Loews Corp 

Risk-Adjusted Performance

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Weak
 
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Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Loews Corp are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent essential indicators, Loews Corp is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

BBQ Holdings and Loews Corp Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with BBQ Holdings and Loews Corp

The main advantage of trading using opposite BBQ Holdings and Loews Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BBQ Holdings position performs unexpectedly, Loews Corp 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 Loews Corp will offset losses from the drop in Loews Corp's long position.
The idea behind BBQ Holdings and Loews Corp 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.
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.

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