Correlation Between TEXAS ROADHOUSE and Fastly

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

By analyzing existing cross correlation between TEXAS ROADHOUSE and Fastly Inc, you can compare the effects of market volatilities on TEXAS ROADHOUSE and Fastly 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 TEXAS ROADHOUSE with a short position of Fastly. Check out your portfolio center. Please also check ongoing floating volatility patterns of TEXAS ROADHOUSE and Fastly.

Diversification Opportunities for TEXAS ROADHOUSE and Fastly

0.73

Correlation Coefficient

TEXAS ROADHOUSE  Fastly

Poor diversification

The 3 months correlation between TEXAS and Fastly is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding TEXAS ROADHOUSE and Fastly Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fastly Inc and TEXAS ROADHOUSE 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 TEXAS ROADHOUSE are associated (or correlated) with Fastly. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fastly Inc has no effect on the direction of TEXAS ROADHOUSE i.e., TEXAS ROADHOUSE and Fastly go up and down completely randomly.

Pair Corralation between TEXAS ROADHOUSE and Fastly

Assuming the 90 days trading horizon TEXAS ROADHOUSE is expected to generate 3.14 times less return on investment than Fastly. But when comparing it to its historical volatility, TEXAS ROADHOUSE is 2.14 times less risky than Fastly. It trades about 0.01 of its potential returns per unit of risk. Fastly Inc is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  656.00  in Fastly Inc on April 21, 2025 and sell it today you would lose (51.00) from holding Fastly Inc or give up 7.77% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

TEXAS ROADHOUSE  vs.  Fastly Inc

TEXAS ROADHOUSE

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in TEXAS ROADHOUSE are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, TEXAS ROADHOUSE exhibited solid returns over the last few months and may actually be approaching a breakup point.

Fastly Inc

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fastly Inc are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, Fastly unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with TEXAS ROADHOUSE and Fastly

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

The idea behind TEXAS ROADHOUSE and Fastly Inc 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.

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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..