Correlation Between Luxfer Holdings and SNDL
Can any of the company-specific risk be diversified away by investing in both Luxfer Holdings 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 Luxfer Holdings and SNDL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Luxfer Holdings PLC and SNDL Inc, you can compare the effects of market volatilities on Luxfer Holdings 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 Luxfer Holdings with a short position of SNDL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Luxfer Holdings and SNDL.
Diversification Opportunities for Luxfer Holdings and SNDL
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Luxfer and SNDL is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Luxfer Holdings PLC and SNDL Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SNDL Inc and Luxfer Holdings 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 Luxfer Holdings PLC 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 Luxfer Holdings i.e., Luxfer Holdings and SNDL go up and down completely randomly.
Pair Corralation between Luxfer Holdings and SNDL
Given the investment horizon of 90 days Luxfer Holdings PLC is expected to generate 0.88 times more return on investment than SNDL. However, Luxfer Holdings PLC is 1.13 times less risky than SNDL. It trades about -0.01 of its potential returns per unit of risk. SNDL Inc is currently generating about -0.14 per unit of risk. If you would invest 1,450 in Luxfer Holdings PLC on October 26, 2024 and sell it today you would lose (20.00) from holding Luxfer Holdings PLC or give up 1.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Luxfer Holdings PLC vs. SNDL Inc
Performance |
| Timeline |
| Luxfer Holdings PLC |
| SNDL Inc |
Luxfer Holdings and SNDL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Luxfer Holdings and SNDL
The main advantage of trading using opposite Luxfer Holdings and SNDL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Luxfer Holdings 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.| Luxfer Holdings vs. Graham | Luxfer Holdings vs. Enerpac Tool Group | Luxfer Holdings vs. Kadant Inc | Luxfer Holdings vs. Omega Flex |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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