Correlation Between SNDL and Four Leaf
Can any of the company-specific risk be diversified away by investing in both SNDL and Four Leaf 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 Four Leaf into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SNDL Inc and Four Leaf Acquisition, you can compare the effects of market volatilities on SNDL and Four Leaf 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 Four Leaf. Check out your portfolio center. Please also check ongoing floating volatility patterns of SNDL and Four Leaf.
Diversification Opportunities for SNDL and Four Leaf
Very good diversification
The 3 months correlation between SNDL and Four is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding SNDL Inc and Four Leaf Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Four Leaf Acquisition 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 Four Leaf. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Four Leaf Acquisition has no effect on the direction of SNDL i.e., SNDL and Four Leaf go up and down completely randomly.
Pair Corralation between SNDL and Four Leaf
Given the investment horizon of 90 days SNDL is expected to generate 1.41 times less return on investment than Four Leaf. In addition to that, SNDL is 26.18 times more volatile than Four Leaf Acquisition. It trades about 0.0 of its total potential returns per unit of risk. Four Leaf Acquisition is currently generating about 0.13 per unit of volatility. If you would invest 1,084 in Four Leaf Acquisition on September 13, 2024 and sell it today you would earn a total of 21.00 from holding Four Leaf Acquisition or generate 1.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SNDL Inc vs. Four Leaf Acquisition
Performance |
| Timeline |
| SNDL Inc |
| Four Leaf Acquisition |
SNDL and Four Leaf Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SNDL and Four Leaf
The main advantage of trading using opposite SNDL and Four Leaf positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SNDL position performs unexpectedly, Four Leaf 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 Four Leaf will offset losses from the drop in Four Leaf's long position.The idea behind SNDL Inc and Four Leaf Acquisition 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.| Four Leaf vs. Titan Machinery | Four Leaf vs. Century Aluminum | Four Leaf vs. Asbury Automotive Group | Four Leaf vs. Pool Corporation |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
Other Complementary Tools
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |