Correlation Between SunLink Health and Sweetgreen
Can any of the company-specific risk be diversified away by investing in both SunLink Health and Sweetgreen 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 SunLink Health and Sweetgreen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SunLink Health Systems and Sweetgreen, you can compare the effects of market volatilities on SunLink Health and Sweetgreen 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 SunLink Health with a short position of Sweetgreen. Check out your portfolio center. Please also check ongoing floating volatility patterns of SunLink Health and Sweetgreen.
Diversification Opportunities for SunLink Health and Sweetgreen
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between SunLink and Sweetgreen is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding SunLink Health Systems and Sweetgreen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sweetgreen and SunLink Health 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 SunLink Health Systems are associated (or correlated) with Sweetgreen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sweetgreen has no effect on the direction of SunLink Health i.e., SunLink Health and Sweetgreen go up and down completely randomly.
Pair Corralation between SunLink Health and Sweetgreen
Considering the 90-day investment horizon SunLink Health Systems is expected to under-perform the Sweetgreen. But the stock apears to be less risky and, when comparing its historical volatility, SunLink Health Systems is 1.18 times less risky than Sweetgreen. The stock trades about -0.18 of its potential returns per unit of risk. The Sweetgreen is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 3,883 in Sweetgreen on August 28, 2024 and sell it today you would earn a total of 514.00 from holding Sweetgreen or generate 13.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SunLink Health Systems vs. Sweetgreen
Performance |
| Timeline |
| SunLink Health Systems |
| Sweetgreen |
SunLink Health and Sweetgreen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SunLink Health and Sweetgreen
The main advantage of trading using opposite SunLink Health and Sweetgreen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SunLink Health position performs unexpectedly, Sweetgreen 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 Sweetgreen will offset losses from the drop in Sweetgreen's long position.| SunLink Health vs. Leafly Holdings | SunLink Health vs. Allstar Health Brands | SunLink Health vs. Leafly Holdings | SunLink Health vs. Kiaro Holdings Corp |
| Sweetgreen vs. Cannae Holdings | Sweetgreen vs. Brinker International | Sweetgreen vs. Jack In The | Sweetgreen vs. Biglari Holdings |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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