Correlation Between Akanda Corp and SNDL
Can any of the company-specific risk be diversified away by investing in both Akanda Corp and SNDL 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 Akanda Corp and SNDL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Akanda Corp and SNDL Inc, you can compare the effects of market volatilities on Akanda Corp and SNDL 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 Akanda Corp with a short position of SNDL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Akanda Corp and SNDL.
Diversification Opportunities for Akanda Corp and SNDL
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Akanda and SNDL is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Akanda Corp and SNDL Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SNDL Inc and Akanda Corp 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 Akanda Corp are associated (or correlated) with SNDL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SNDL Inc has no effect on the direction of Akanda Corp i.e., Akanda Corp and SNDL go up and down completely randomly.
Pair Corralation between Akanda Corp and SNDL
Given the investment horizon of 90 days Akanda Corp is expected to generate 4.75 times more return on investment than SNDL. However, Akanda Corp is 4.75 times more volatile than SNDL Inc. It trades about 0.12 of its potential returns per unit of risk. SNDL Inc is currently generating about -0.33 per unit of risk. If you would invest 139.00 in Akanda Corp on September 13, 2024 and sell it today you would earn a total of 16.00 from holding Akanda Corp or generate 11.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Akanda Corp vs. SNDL Inc
Performance |
| Timeline |
| Akanda Corp |
| SNDL Inc |
Akanda Corp and SNDL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Akanda Corp and SNDL
The main advantage of trading using opposite Akanda Corp and SNDL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Akanda Corp position performs unexpectedly, SNDL 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 SNDL will offset losses from the drop in SNDL's long position.| Akanda Corp vs. China SXT Pharmaceuticals | Akanda Corp vs. Petros Pharmaceuticals | Akanda Corp vs. GelStat Corp | Akanda Corp vs. Shuttle Pharmaceuticals |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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