Correlation Between Good Times and Benchmark Electronics
Can any of the company-specific risk be diversified away by investing in both Good Times and Benchmark Electronics 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 Good Times and Benchmark Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Good Times Restaurants and Benchmark Electronics, you can compare the effects of market volatilities on Good Times and Benchmark Electronics 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 Good Times with a short position of Benchmark Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Good Times and Benchmark Electronics.
Diversification Opportunities for Good Times and Benchmark Electronics
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Good and Benchmark is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Good Times Restaurants and Benchmark Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Benchmark Electronics and Good Times 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 Good Times Restaurants are associated (or correlated) with Benchmark Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Benchmark Electronics has no effect on the direction of Good Times i.e., Good Times and Benchmark Electronics go up and down completely randomly.
Pair Corralation between Good Times and Benchmark Electronics
Given the investment horizon of 90 days Good Times Restaurants is expected to generate 2.17 times more return on investment than Benchmark Electronics. However, Good Times is 2.17 times more volatile than Benchmark Electronics. It trades about 0.1 of its potential returns per unit of risk. Benchmark Electronics is currently generating about 0.07 per unit of risk. If you would invest 147.00 in Good Times Restaurants on July 27, 2025 and sell it today you would earn a total of 39.00 from holding Good Times Restaurants or generate 26.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Good Times Restaurants vs. Benchmark Electronics
Performance |
| Timeline |
| Good Times Restaurants |
| Benchmark Electronics |
Good Times and Benchmark Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Good Times and Benchmark Electronics
The main advantage of trading using opposite Good Times and Benchmark Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Good Times position performs unexpectedly, Benchmark Electronics 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 Benchmark Electronics will offset losses from the drop in Benchmark Electronics' long position.| Good Times vs. Premium Catering Limited | Good Times vs. Bt Brands | Good Times vs. Reborn Coffee | Good Times vs. Lulus Fashion Lounge |
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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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