Correlation Between Skechers USA and SNDL
Can any of the company-specific risk be diversified away by investing in both Skechers USA 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 Skechers USA and SNDL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Skechers USA and SNDL Inc, you can compare the effects of market volatilities on Skechers USA 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 Skechers USA with a short position of SNDL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Skechers USA and SNDL.
Diversification Opportunities for Skechers USA and SNDL
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Skechers and SNDL is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Skechers USA and SNDL Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SNDL Inc and Skechers USA 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 Skechers USA 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 Skechers USA i.e., Skechers USA and SNDL go up and down completely randomly.
Pair Corralation between Skechers USA and SNDL
Considering the 90-day investment horizon Skechers USA is expected to generate 0.69 times more return on investment than SNDL. However, Skechers USA is 1.45 times less risky than SNDL. It trades about -0.02 of its potential returns per unit of risk. SNDL Inc is currently generating about -0.01 per unit of risk. If you would invest 7,080 in Skechers USA on September 3, 2024 and sell it today you would lose (515.00) from holding Skechers USA or give up 7.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Skechers USA vs. SNDL Inc
Performance |
| Timeline |
| Skechers USA |
| SNDL Inc |
Skechers USA and SNDL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Skechers USA and SNDL
The main advantage of trading using opposite Skechers USA and SNDL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Skechers USA 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.| Skechers USA vs. Designer Brands | Skechers USA vs. Steven Madden | Skechers USA vs. Weyco Group | Skechers USA vs. Rocky Brands |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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