Correlation Between First Citizens and Rave Restaurant

Can any of the company-specific risk be diversified away by investing in both First Citizens and Rave Restaurant 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 First Citizens and Rave Restaurant into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between The First Citizens and Rave Restaurant Group, you can compare the effects of market volatilities on First Citizens and Rave Restaurant 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 First Citizens with a short position of Rave Restaurant. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Citizens and Rave Restaurant.

Diversification Opportunities for First Citizens and Rave Restaurant

0.09

Correlation Coefficient

First Citizens  Rave Restaurant

Significant diversification

The 3 months correlation between First and Rave is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding The First Citizens and Rave Restaurant Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rave Restaurant Group and First Citizens 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 The First Citizens are associated (or correlated) with Rave Restaurant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rave Restaurant Group has no effect on the direction of First Citizens i.e., First Citizens and Rave Restaurant go up and down completely randomly.

Pair Corralation between First Citizens and Rave Restaurant

Given the investment horizon of 90 days The First Citizens is expected to under-perform the Rave Restaurant. In addition to that, First Citizens is 6.66 times more volatile than Rave Restaurant Group. It trades about -0.18 of its total potential returns per unit of risk. Rave Restaurant Group is currently generating about 0.02 per unit of volatility. If you would invest  274.00  in Rave Restaurant Group on May 20, 2025 and sell it today you would earn a total of  3.00  from holding Rave Restaurant Group or generate 1.09% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	45.16%
Values	Daily Returns

The First Citizens  vs.  Rave Restaurant Group

First Citizens

Risk-Adjusted Performance

Weakest

Over the last 90 days The First Citizens has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's fundamental indicators remain quite persistent which may send shares a bit higher in September 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Rave Restaurant Group

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Rave Restaurant Group are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Rave Restaurant is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with First Citizens and Rave Restaurant

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

The idea behind The First Citizens and Rave Restaurant Group 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.