Correlation Between SunOpta and Marchex
Can any of the company-specific risk be diversified away by investing in both SunOpta and Marchex 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 Marchex into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SunOpta and Marchex, you can compare the effects of market volatilities on SunOpta and Marchex 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 Marchex. Check out your portfolio center. Please also check ongoing floating volatility patterns of SunOpta and Marchex.
Diversification Opportunities for SunOpta and Marchex
Very good diversification
The 3 months correlation between SunOpta and Marchex is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding SunOpta and Marchex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marchex 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 Marchex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marchex has no effect on the direction of SunOpta i.e., SunOpta and Marchex go up and down completely randomly.
Pair Corralation between SunOpta and Marchex
Given the investment horizon of 90 days SunOpta is expected to generate 0.85 times more return on investment than Marchex. However, SunOpta is 1.18 times less risky than Marchex. It trades about 0.42 of its potential returns per unit of risk. Marchex is currently generating about 0.07 per unit of risk. If you would invest 586.00 in SunOpta on August 31, 2024 and sell it today you would earn a total of 195.00 from holding SunOpta or generate 33.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SunOpta vs. Marchex
Performance |
| Timeline |
| SunOpta |
| Marchex |
SunOpta and Marchex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SunOpta and Marchex
The main advantage of trading using opposite SunOpta and Marchex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SunOpta position performs unexpectedly, Marchex 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 Marchex will offset losses from the drop in Marchex's long position.| SunOpta vs. Central Garden Pet | SunOpta vs. Bridgford Foods | SunOpta vs. Lancaster Colony | SunOpta vs. HUMANA INC |
| Marchex vs. Entravision Communications | Marchex vs. Direct Digital Holdings | Marchex vs. Cimpress NV | Marchex vs. Townsquare Media |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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