Correlation Between SunLink Health and SunOpta
Can any of the company-specific risk be diversified away by investing in both SunLink Health and SunOpta 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 SunOpta 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 SunOpta, you can compare the effects of market volatilities on SunLink Health and SunOpta 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 SunOpta. Check out your portfolio center. Please also check ongoing floating volatility patterns of SunLink Health and SunOpta.
Diversification Opportunities for SunLink Health and SunOpta
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SunLink and SunOpta is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding SunLink Health Systems and SunOpta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SunOpta 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 SunOpta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SunOpta has no effect on the direction of SunLink Health i.e., SunLink Health and SunOpta go up and down completely randomly.
Pair Corralation between SunLink Health and SunOpta
Considering the 90-day investment horizon SunLink Health is expected to generate 1.83 times less return on investment than SunOpta. In addition to that, SunLink Health is 2.08 times more volatile than SunOpta. It trades about 0.09 of its total potential returns per unit of risk. SunOpta is currently generating about 0.36 per unit of volatility. If you would invest 655.00 in SunOpta on September 1, 2024 and sell it today you would earn a total of 120.00 from holding SunOpta or generate 18.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SunLink Health Systems vs. SunOpta
Performance |
| Timeline |
| SunLink Health Systems |
| SunOpta |
SunLink Health and SunOpta Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SunLink Health and SunOpta
The main advantage of trading using opposite SunLink Health and SunOpta positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SunLink Health position performs unexpectedly, SunOpta 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 SunOpta will offset losses from the drop in SunOpta'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 |
| SunOpta vs. Seneca Foods Corp | SunOpta vs. Central Garden Pet | SunOpta vs. Central Garden Pet | SunOpta vs. Natures Sunshine Products |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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