Correlation Between Safety Shot and SunOpta
Can any of the company-specific risk be diversified away by investing in both Safety Shot and SunOpta 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 Safety Shot and SunOpta into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Safety Shot and SunOpta, you can compare the effects of market volatilities on Safety Shot and SunOpta 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 Safety Shot with a short position of SunOpta. Check out your portfolio center. Please also check ongoing floating volatility patterns of Safety Shot and SunOpta.
Diversification Opportunities for Safety Shot and SunOpta
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Safety and SunOpta is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Safety Shot and SunOpta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SunOpta and Safety Shot 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 Safety Shot are associated (or correlated) with SunOpta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SunOpta has no effect on the direction of Safety Shot i.e., Safety Shot and SunOpta go up and down completely randomly.
Pair Corralation between Safety Shot and SunOpta
Assuming the 90 days horizon Safety Shot is expected to generate 6.35 times more return on investment than SunOpta. However, Safety Shot is 6.35 times more volatile than SunOpta. It trades about 0.07 of its potential returns per unit of risk. SunOpta is currently generating about 0.01 per unit of risk. If you would invest 39.00 in Safety Shot on August 30, 2024 and sell it today you would lose (26.00) from holding Safety Shot or give up 66.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 60.08% |
| Values | Daily Returns |
Safety Shot vs. SunOpta
Performance |
| Timeline |
| Safety Shot |
| SunOpta |
Safety Shot and SunOpta Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Safety Shot and SunOpta
The main advantage of trading using opposite Safety Shot and SunOpta positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Safety Shot position performs unexpectedly, SunOpta 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 SunOpta will offset losses from the drop in SunOpta's long position.The idea behind Safety Shot and SunOpta 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.| SunOpta vs. Seneca Foods Corp | SunOpta vs. Central Garden Pet | SunOpta vs. Central Garden Pet | SunOpta vs. Natures Sunshine Products |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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