Correlation Between Sweetgreen and Cannae Holdings
Can any of the company-specific risk be diversified away by investing in both Sweetgreen and Cannae Holdings 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 Sweetgreen and Cannae Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sweetgreen and Cannae Holdings, you can compare the effects of market volatilities on Sweetgreen and Cannae Holdings 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 Sweetgreen with a short position of Cannae Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sweetgreen and Cannae Holdings.
Diversification Opportunities for Sweetgreen and Cannae Holdings
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sweetgreen and Cannae is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Sweetgreen and Cannae Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cannae Holdings and Sweetgreen 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 Sweetgreen are associated (or correlated) with Cannae Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cannae Holdings has no effect on the direction of Sweetgreen i.e., Sweetgreen and Cannae Holdings go up and down completely randomly.
Pair Corralation between Sweetgreen and Cannae Holdings
Allowing for the 90-day total investment horizon Sweetgreen is expected to generate 3.18 times more return on investment than Cannae Holdings. However, Sweetgreen is 3.18 times more volatile than Cannae Holdings. It trades about 0.07 of its potential returns per unit of risk. Cannae Holdings is currently generating about 0.02 per unit of risk. If you would invest 2,455 in Sweetgreen on November 3, 2024 and sell it today you would earn a total of 837.00 from holding Sweetgreen or generate 34.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.2% |
| Values | Daily Returns |
Sweetgreen vs. Cannae Holdings
Performance |
| Timeline |
| Sweetgreen |
| Cannae Holdings |
Sweetgreen and Cannae Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sweetgreen and Cannae Holdings
The main advantage of trading using opposite Sweetgreen and Cannae Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sweetgreen position performs unexpectedly, Cannae Holdings 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 Cannae Holdings will offset losses from the drop in Cannae Holdings' long position.| Sweetgreen vs. Cannae Holdings | Sweetgreen vs. Brinker International | Sweetgreen vs. Jack In The | Sweetgreen vs. Biglari Holdings |
| Cannae Holdings vs. Adtalem Global Education | Cannae Holdings vs. Hamilton Lane | Cannae Holdings vs. ConnectOne Bancorp |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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