Correlation Between Berkeley Lights and Sweetgreen

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Can any of the company-specific risk be diversified away by investing in both Berkeley Lights and Sweetgreen 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 Berkeley Lights and Sweetgreen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Berkeley Lights and Sweetgreen, you can compare the effects of market volatilities on Berkeley Lights and Sweetgreen 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 Berkeley Lights with a short position of Sweetgreen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Berkeley Lights and Sweetgreen.

Diversification Opportunities for Berkeley Lights and Sweetgreen

-0.48
  Correlation Coefficient

Very good diversification

The 3 months correlation between Berkeley and Sweetgreen is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Berkeley Lights and Sweetgreen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sweetgreen and Berkeley Lights 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 Berkeley Lights are associated (or correlated) with Sweetgreen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sweetgreen has no effect on the direction of Berkeley Lights i.e., Berkeley Lights and Sweetgreen go up and down completely randomly.

Pair Corralation between Berkeley Lights and Sweetgreen

If you would invest  3,374  in Sweetgreen on September 17, 2024 and sell it today you would earn a total of  72.00  from holding Sweetgreen or generate 2.13% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy1.56%
ValuesDaily Returns

Berkeley Lights  vs.  Sweetgreen

 Performance 
       Timeline  
Berkeley Lights 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Berkeley Lights has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong essential indicators, Berkeley Lights is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.
Sweetgreen 

Risk-Adjusted Performance

2 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Sweetgreen are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady technical and fundamental indicators, Sweetgreen may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Berkeley Lights and Sweetgreen Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Berkeley Lights and Sweetgreen

The main advantage of trading using opposite Berkeley Lights and Sweetgreen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Berkeley Lights position performs unexpectedly, Sweetgreen 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 Sweetgreen will offset losses from the drop in Sweetgreen's long position.
The idea behind Berkeley Lights and Sweetgreen pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.

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