Correlation Between SunOpta and Chemours
Can any of the company-specific risk be diversified away by investing in both SunOpta and Chemours 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 SunOpta and Chemours into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SunOpta and Chemours Co, you can compare the effects of market volatilities on SunOpta and Chemours 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 SunOpta with a short position of Chemours. Check out your portfolio center. Please also check ongoing floating volatility patterns of SunOpta and Chemours.
Diversification Opportunities for SunOpta and Chemours
Modest diversification
The 3 months correlation between SunOpta and Chemours is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding SunOpta and Chemours Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chemours and SunOpta 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 SunOpta are associated (or correlated) with Chemours. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chemours has no effect on the direction of SunOpta i.e., SunOpta and Chemours go up and down completely randomly.
Pair Corralation between SunOpta and Chemours
Given the investment horizon of 90 days SunOpta is expected to generate 0.45 times more return on investment than Chemours. However, SunOpta is 2.21 times less risky than Chemours. It trades about 0.2 of its potential returns per unit of risk. Chemours Co is currently generating about -0.27 per unit of risk. If you would invest 730.00 in SunOpta on November 18, 2024 and sell it today you would earn a total of 34.00 from holding SunOpta or generate 4.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SunOpta vs. Chemours Co
Performance |
| Timeline |
| SunOpta |
| Chemours |
SunOpta and Chemours Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SunOpta and Chemours
The main advantage of trading using opposite SunOpta and Chemours positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SunOpta position performs unexpectedly, Chemours 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 Chemours will offset losses from the drop in Chemours' long position.| SunOpta vs. Seneca Foods Corp | SunOpta vs. Central Garden Pet | SunOpta vs. Central Garden Pet | SunOpta vs. Natures Sunshine Products |
| Chemours vs. International Flavors Fragrances | Chemours vs. Air Products and | Chemours vs. PPG Industries | Chemours vs. Linde plc Ordinary |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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