Correlation Between SNDL and CopAur Minerals
Can any of the company-specific risk be diversified away by investing in both SNDL and CopAur Minerals 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 SNDL and CopAur Minerals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SNDL Inc and CopAur Minerals, you can compare the effects of market volatilities on SNDL and CopAur Minerals 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 SNDL with a short position of CopAur Minerals. Check out your portfolio center. Please also check ongoing floating volatility patterns of SNDL and CopAur Minerals.
Diversification Opportunities for SNDL and CopAur Minerals
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between SNDL and CopAur is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding SNDL Inc and CopAur Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CopAur Minerals and SNDL 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 SNDL Inc are associated (or correlated) with CopAur Minerals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CopAur Minerals has no effect on the direction of SNDL i.e., SNDL and CopAur Minerals go up and down completely randomly.
Pair Corralation between SNDL and CopAur Minerals
Given the investment horizon of 90 days SNDL Inc is expected to generate 0.67 times more return on investment than CopAur Minerals. However, SNDL Inc is 1.49 times less risky than CopAur Minerals. It trades about 0.04 of its potential returns per unit of risk. CopAur Minerals is currently generating about -0.03 per unit of risk. If you would invest 145.00 in SNDL Inc on August 31, 2024 and sell it today you would earn a total of 48.00 from holding SNDL Inc or generate 33.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.73% |
| Values | Daily Returns |
SNDL Inc vs. CopAur Minerals
Performance |
| Timeline |
| SNDL Inc |
| CopAur Minerals |
SNDL and CopAur Minerals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SNDL and CopAur Minerals
The main advantage of trading using opposite SNDL and CopAur Minerals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SNDL position performs unexpectedly, CopAur Minerals 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 CopAur Minerals will offset losses from the drop in CopAur Minerals' long position.The idea behind SNDL Inc and CopAur Minerals 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.| CopAur Minerals vs. Constellation Brands Class | CopAur Minerals vs. SNDL Inc | CopAur Minerals vs. National Beverage Corp | CopAur Minerals vs. Scandinavian Tobacco Group |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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