Correlation Between BJs Restaurants and Canadian National

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

By analyzing existing cross correlation between BJs Restaurants and Canadian National Railway, you can compare the effects of market volatilities on BJs Restaurants and Canadian National 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 BJs Restaurants with a short position of Canadian National. Check out your portfolio center. Please also check ongoing floating volatility patterns of BJs Restaurants and Canadian National.

Diversification Opportunities for BJs Restaurants and Canadian National

0.59

Correlation Coefficient

BJs Restaurants  Canadian National

Very weak diversification

The 3 months correlation between BJs and Canadian is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding BJs Restaurants and Canadian National Railway in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canadian National Railway and BJs Restaurants 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 BJs Restaurants are associated (or correlated) with Canadian National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canadian National Railway has no effect on the direction of BJs Restaurants i.e., BJs Restaurants and Canadian National go up and down completely randomly.

Pair Corralation between BJs Restaurants and Canadian National

Assuming the 90 days trading horizon BJs Restaurants is expected to generate 3.21 times more return on investment than Canadian National. However, BJs Restaurants is 3.21 times more volatile than Canadian National Railway. It trades about 0.14 of its potential returns per unit of risk. Canadian National Railway is currently generating about 0.07 per unit of risk. If you would invest  2,680  in BJs Restaurants on October 6, 2025 and sell it today you would earn a total of  820.00  from holding BJs Restaurants or generate 30.6% return on investment over 90 days.

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

BJs Restaurants  vs.  Canadian National Railway

BJs Restaurants

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in BJs Restaurants are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, BJs Restaurants unveiled solid returns over the last few months and may actually be approaching a breakup point.

Canadian National Railway

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Canadian National Railway are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Canadian National is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with BJs Restaurants and Canadian National

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

The idea behind BJs Restaurants and Canadian National Railway 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.