Correlation Between AETNA and SNDL
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By analyzing existing cross correlation between AETNA INC NEW and SNDL Inc, you can compare the effects of market volatilities on AETNA and SNDL 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 AETNA with a short position of SNDL. Check out your portfolio center. Please also check ongoing floating volatility patterns of AETNA and SNDL.
Diversification Opportunities for AETNA and SNDL
Average diversification
The 3 months correlation between AETNA and SNDL is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding AETNA INC NEW and SNDL Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SNDL Inc and AETNA 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 AETNA INC NEW are associated (or correlated) with SNDL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SNDL Inc has no effect on the direction of AETNA i.e., AETNA and SNDL go up and down completely randomly.
Pair Corralation between AETNA and SNDL
Assuming the 90 days trading horizon AETNA INC NEW is expected to under-perform the SNDL. But the bond apears to be less risky and, when comparing its historical volatility, AETNA INC NEW is 19.3 times less risky than SNDL. The bond trades about -0.08 of its potential returns per unit of risk. The SNDL Inc is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 197.00 in SNDL Inc on September 2, 2024 and sell it today you would lose (4.00) from holding SNDL Inc or give up 2.03% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 78.13% |
| Values | Daily Returns |
AETNA INC NEW vs. SNDL Inc
Performance |
| Timeline |
| AETNA INC NEW |
| SNDL Inc |
AETNA and SNDL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AETNA and SNDL
The main advantage of trading using opposite AETNA and SNDL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AETNA position performs unexpectedly, SNDL 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 SNDL will offset losses from the drop in SNDL's long position.The idea behind AETNA INC NEW and SNDL Inc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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