Correlation Between SCI Engineered and BJs Restaurants
Can any of the company-specific risk be diversified away by investing in both SCI Engineered 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 SCI Engineered and BJs Restaurants into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SCI Engineered Materials and BJs Restaurants, you can compare the effects of market volatilities on SCI Engineered 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 SCI Engineered with a short position of BJs Restaurants. Check out your portfolio center. Please also check ongoing floating volatility patterns of SCI Engineered and BJs Restaurants.
Diversification Opportunities for SCI Engineered and BJs Restaurants
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between SCI and BJs is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding SCI Engineered Materials and BJs Restaurants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BJs Restaurants and SCI Engineered 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 SCI Engineered Materials 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 SCI Engineered i.e., SCI Engineered and BJs Restaurants go up and down completely randomly.
Pair Corralation between SCI Engineered and BJs Restaurants
Given the investment horizon of 90 days SCI Engineered Materials is expected to generate 0.82 times more return on investment than BJs Restaurants. However, SCI Engineered Materials is 1.22 times less risky than BJs Restaurants. It trades about 0.14 of its potential returns per unit of risk. BJs Restaurants is currently generating about 0.07 per unit of risk. If you would invest 400.00 in SCI Engineered Materials on September 5, 2025 and sell it today you would earn a total of 100.00 from holding SCI Engineered Materials or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SCI Engineered Materials vs. BJs Restaurants
Performance |
| Timeline |
| SCI Engineered Materials |
| BJs Restaurants |
SCI Engineered and BJs Restaurants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SCI Engineered and BJs Restaurants
The main advantage of trading using opposite SCI Engineered and BJs Restaurants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SCI Engineered 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.| SCI Engineered vs. ASML Holding NV | SCI Engineered vs. ASML Holding NV | SCI Engineered vs. Lam Research Corp | SCI Engineered vs. Applied Materials |
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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