Correlation Between SunOpta and Treasury Wine
Can any of the company-specific risk be diversified away by investing in both SunOpta and Treasury Wine 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 Treasury Wine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SunOpta and Treasury Wine Estates, you can compare the effects of market volatilities on SunOpta and Treasury Wine 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 Treasury Wine. Check out your portfolio center. Please also check ongoing floating volatility patterns of SunOpta and Treasury Wine.
Diversification Opportunities for SunOpta and Treasury Wine
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SunOpta and Treasury is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding SunOpta and Treasury Wine Estates in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Treasury Wine Estates 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 Treasury Wine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Treasury Wine Estates has no effect on the direction of SunOpta i.e., SunOpta and Treasury Wine go up and down completely randomly.
Pair Corralation between SunOpta and Treasury Wine
Given the investment horizon of 90 days SunOpta is expected to generate 1.08 times more return on investment than Treasury Wine. However, SunOpta is 1.08 times more volatile than Treasury Wine Estates. It trades about 0.36 of its potential returns per unit of risk. Treasury Wine Estates is currently generating about -0.22 per unit of risk. 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 | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SunOpta vs. Treasury Wine Estates
Performance |
| Timeline |
| SunOpta |
| Treasury Wine Estates |
SunOpta and Treasury Wine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SunOpta and Treasury Wine
The main advantage of trading using opposite SunOpta and Treasury Wine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SunOpta position performs unexpectedly, Treasury Wine 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 Treasury Wine will offset losses from the drop in Treasury Wine's long position.| SunOpta vs. Seneca Foods Corp | SunOpta vs. Central Garden Pet | SunOpta vs. Central Garden Pet | SunOpta vs. Natures Sunshine Products |
| Treasury Wine vs. Pernod Ricard SA | Treasury Wine vs. Willamette Valley Vineyards | Treasury Wine vs. MGP Ingredients | Treasury Wine vs. Duckhorn Portfolio |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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