Correlation Between Premium Catering and Wendys
Can any of the company-specific risk be diversified away by investing in both Premium Catering and Wendys 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 Premium Catering and Wendys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Premium Catering Limited and The Wendys Co, you can compare the effects of market volatilities on Premium Catering and Wendys 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 Premium Catering with a short position of Wendys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Premium Catering and Wendys.
Diversification Opportunities for Premium Catering and Wendys
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Premium and Wendys is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Premium Catering Limited and The Wendys Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The Wendys and Premium Catering 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 Premium Catering Limited are associated (or correlated) with Wendys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of The Wendys has no effect on the direction of Premium Catering i.e., Premium Catering and Wendys go up and down completely randomly.
Pair Corralation between Premium Catering and Wendys
Allowing for the 90-day total investment horizon Premium Catering Limited is expected to generate 3.62 times more return on investment than Wendys. However, Premium Catering is 3.62 times more volatile than The Wendys Co. It trades about 0.15 of its potential returns per unit of risk. The Wendys Co is currently generating about -0.1 per unit of risk. If you would invest 554.00 in Premium Catering Limited on July 20, 2025 and sell it today you would earn a total of 386.00 from holding Premium Catering Limited or generate 69.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Premium Catering Limited vs. The Wendys Co
Performance |
| Timeline |
| Premium Catering |
| The Wendys |
Premium Catering and Wendys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Premium Catering and Wendys
The main advantage of trading using opposite Premium Catering and Wendys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Premium Catering position performs unexpectedly, Wendys 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 Wendys will offset losses from the drop in Wendys' long position.| Premium Catering vs. Good Times Restaurants | Premium Catering vs. HWH International | Premium Catering vs. Energy Focu | Premium Catering vs. iPower Inc |
| Wendys vs. Papa Johns International | Wendys vs. Arcos Dorados Holdings | Wendys vs. Kohls | Wendys vs. Century Communities |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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