Correlation Between PPL and BJs Restaurants
Can any of the company-specific risk be diversified away by investing in both PPL and BJs Restaurants 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 PPL and BJs Restaurants into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PPL Corporation and BJs Restaurants, you can compare the effects of market volatilities on PPL and BJs Restaurants 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 PPL with a short position of BJs Restaurants. Check out your portfolio center. Please also check ongoing floating volatility patterns of PPL and BJs Restaurants.
Diversification Opportunities for PPL and BJs Restaurants
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between PPL and BJs is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding PPL Corp. and BJs Restaurants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BJs Restaurants and PPL 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 PPL Corporation are associated (or correlated) with BJs Restaurants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BJs Restaurants has no effect on the direction of PPL i.e., PPL and BJs Restaurants go up and down completely randomly.
Pair Corralation between PPL and BJs Restaurants
Considering the 90-day investment horizon PPL Corporation is expected to under-perform the BJs Restaurants. But the stock apears to be less risky and, when comparing its historical volatility, PPL Corporation is 3.65 times less risky than BJs Restaurants. The stock trades about 0.0 of its potential returns per unit of risk. The BJs Restaurants is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 3,385 in BJs Restaurants on September 3, 2025 and sell it today you would earn a total of 337.00 from holding BJs Restaurants or generate 9.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PPL Corp. vs. BJs Restaurants
Performance |
| Timeline |
| PPL Corporation |
| BJs Restaurants |
PPL and BJs Restaurants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PPL and BJs Restaurants
The main advantage of trading using opposite PPL and BJs Restaurants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PPL position performs unexpectedly, BJs Restaurants 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 BJs Restaurants will offset losses from the drop in BJs Restaurants' long position.| PPL vs. US GoldMining Common | PPL vs. Kingsrose Mining Limited | PPL vs. Upland Software | PPL vs. Zhaojin Mining Industry |
| BJs Restaurants vs. Dairy Farm International | BJs Restaurants vs. RadView Software | BJs Restaurants vs. PSI Software AG | BJs Restaurants vs. Rheon Automatic Machinery |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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