Correlation Between Burgerfi International and Caesars Entertainment
Can any of the company-specific risk be diversified away by investing in both Burgerfi International and Caesars Entertainment 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 Burgerfi International and Caesars Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Burgerfi International and Caesars Entertainment, you can compare the effects of market volatilities on Burgerfi International and Caesars Entertainment 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 Burgerfi International with a short position of Caesars Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Burgerfi International and Caesars Entertainment.
Diversification Opportunities for Burgerfi International and Caesars Entertainment
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Burgerfi and Caesars is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Burgerfi International and Caesars Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caesars Entertainment and Burgerfi International 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 Burgerfi International are associated (or correlated) with Caesars Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caesars Entertainment has no effect on the direction of Burgerfi International i.e., Burgerfi International and Caesars Entertainment go up and down completely randomly.
Pair Corralation between Burgerfi International and Caesars Entertainment
Considering the 90-day investment horizon Burgerfi International is expected to under-perform the Caesars Entertainment. In addition to that, Burgerfi International is 1.12 times more volatile than Caesars Entertainment. It trades about -0.48 of its total potential returns per unit of risk. Caesars Entertainment is currently generating about 0.02 per unit of volatility. If you would invest 3,635 in Caesars Entertainment on March 8, 2024 and sell it today you would earn a total of 22.00 from holding Caesars Entertainment or generate 0.61% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Burgerfi International vs. Caesars Entertainment
Performance |
Timeline |
Burgerfi International |
Caesars Entertainment |
Burgerfi International and Caesars Entertainment Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Burgerfi International and Caesars Entertainment
The main advantage of trading using opposite Burgerfi International and Caesars Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Burgerfi International position performs unexpectedly, Caesars Entertainment 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 Caesars Entertainment will offset losses from the drop in Caesars Entertainment's long position.Burgerfi International vs. Malaga Financial | Burgerfi International vs. LiCycle Holdings Corp | Burgerfi International vs. Kosmos Energy | Burgerfi International vs. Euronav NV |
Caesars Entertainment vs. Golden Entertainment | Caesars Entertainment vs. Red Rock Resorts | Caesars Entertainment vs. Century Casinos | Caesars Entertainment vs. Ballys Corp |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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