Correlation Between GobiMin and SNDL
Can any of the company-specific risk be diversified away by investing in both GobiMin 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 GobiMin and SNDL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GobiMin and SNDL Inc, you can compare the effects of market volatilities on GobiMin 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 GobiMin with a short position of SNDL. Check out your portfolio center. Please also check ongoing floating volatility patterns of GobiMin and SNDL.
Diversification Opportunities for GobiMin and SNDL
Very good diversification
The 3 months correlation between GobiMin and SNDL is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding GobiMin and SNDL Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SNDL Inc and GobiMin 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 GobiMin 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 GobiMin i.e., GobiMin and SNDL go up and down completely randomly.
Pair Corralation between GobiMin and SNDL
Assuming the 90 days horizon GobiMin is expected to generate 2.1 times less return on investment than SNDL. But when comparing it to its historical volatility, GobiMin is 11.87 times less risky than SNDL. It trades about 0.09 of its potential returns per unit of risk. SNDL Inc is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 203.00 in SNDL Inc on September 12, 2024 and sell it today you would lose (18.50) from holding SNDL Inc or give up 9.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 10.71% |
| Values | Daily Returns |
GobiMin vs. SNDL Inc
Performance |
| Timeline |
| GobiMin |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| SNDL Inc |
GobiMin and SNDL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GobiMin and SNDL
The main advantage of trading using opposite GobiMin and SNDL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GobiMin 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.| GobiMin vs. Vodka Brands Corp | GobiMin vs. Ecovyst | GobiMin vs. Brandywine Realty Trust | GobiMin vs. Keurig Dr Pepper |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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