Correlation Between Snap and Roots Corp
Can any of the company-specific risk be diversified away by investing in both Snap and Roots Corp 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 Snap and Roots Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Snap Inc and Roots Corp, you can compare the effects of market volatilities on Snap and Roots Corp 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 Snap with a short position of Roots Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Snap and Roots Corp.
Diversification Opportunities for Snap and Roots Corp
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Snap and Roots is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Snap Inc and Roots Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Roots Corp and Snap 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 Snap Inc are associated (or correlated) with Roots Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Roots Corp has no effect on the direction of Snap i.e., Snap and Roots Corp go up and down completely randomly.
Pair Corralation between Snap and Roots Corp
Given the investment horizon of 90 days Snap Inc is expected to under-perform the Roots Corp. In addition to that, Snap is 1.5 times more volatile than Roots Corp. It trades about -0.28 of its total potential returns per unit of risk. Roots Corp is currently generating about -0.06 per unit of volatility. If you would invest 328.00 in Roots Corp on November 18, 2025 and sell it today you would lose (28.00) from holding Roots Corp or give up 8.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.39% |
| Values | Daily Returns |
Snap Inc vs. Roots Corp
Performance |
| Timeline |
| Snap Inc |
| Roots Corp |
Snap and Roots Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Snap and Roots Corp
The main advantage of trading using opposite Snap and Roots Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Snap position performs unexpectedly, Roots Corp 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 Roots Corp will offset losses from the drop in Roots Corp's long position.The idea behind Snap Inc and Roots Corp 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.| Roots Corp vs. Reitmans Limited | Roots Corp vs. Reitmans Canada | Roots Corp vs. Transat AT | Roots Corp vs. Supremex |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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