Correlation Between E Home and Ark Restaurants

Can any of the company-specific risk be diversified away by investing in both E Home and Ark 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 E Home and Ark Restaurants into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between E Home Household Service and Ark Restaurants Corp, you can compare the effects of market volatilities on E Home and Ark 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 E Home with a short position of Ark Restaurants. Check out your portfolio center. Please also check ongoing floating volatility patterns of E Home and Ark Restaurants.

Diversification Opportunities for E Home and Ark Restaurants

-0.03

Correlation Coefficient

E Home  Ark Restaurants

Good diversification

The 3 months correlation between EJH and Ark is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding E Home Household Service and Ark Restaurants Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ark Restaurants Corp and E Home 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 E Home Household Service are associated (or correlated) with Ark Restaurants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ark Restaurants Corp has no effect on the direction of E Home i.e., E Home and Ark Restaurants go up and down completely randomly.

Pair Corralation between E Home and Ark Restaurants

Considering the 90-day investment horizon E Home Household Service is expected to under-perform the Ark Restaurants. In addition to that, E Home is 4.53 times more volatile than Ark Restaurants Corp. It trades about -0.08 of its total potential returns per unit of risk. Ark Restaurants Corp is currently generating about -0.21 per unit of volatility. If you would invest  1,173  in Ark Restaurants Corp on May 6, 2025 and sell it today you would lose (338.00) from holding Ark Restaurants Corp or give up 28.82% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	96.83%
Values	Daily Returns

E Home Household Service  vs.  Ark Restaurants Corp

E Home Household

Risk-Adjusted Performance

Very Weak

Over the last 90 days E Home Household Service has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's forward-looking indicators remain fairly strong which may send shares a bit higher in September 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Ark Restaurants Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ark Restaurants Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with uncertain performance in the last few months, the Stock's forward-looking signals remain relatively invariable which may send shares a bit higher in September 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with E Home and Ark Restaurants

The main advantage of trading using opposite E Home and Ark Restaurants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if E Home position performs unexpectedly, Ark 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 Ark Restaurants will offset losses from the drop in Ark Restaurants' long position.

The idea behind E Home Household Service and Ark Restaurants Corp 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.