Correlation Between Tidal Trust and Sanara Medtech

Can any of the company-specific risk be diversified away by investing in both Tidal Trust and Sanara Medtech 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 Tidal Trust and Sanara Medtech into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Tidal Trust II and Sanara Medtech, you can compare the effects of market volatilities on Tidal Trust and Sanara Medtech 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 Tidal Trust with a short position of Sanara Medtech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tidal Trust and Sanara Medtech.

Diversification Opportunities for Tidal Trust and Sanara Medtech

-0.34

Correlation Coefficient

Tidal Trust  Sanara Medtech

Very good diversification

The 3 months correlation between Tidal and Sanara is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Tidal Trust II and Sanara Medtech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sanara Medtech and Tidal Trust 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 Tidal Trust II are associated (or correlated) with Sanara Medtech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sanara Medtech has no effect on the direction of Tidal Trust i.e., Tidal Trust and Sanara Medtech go up and down completely randomly.

Pair Corralation between Tidal Trust and Sanara Medtech

Given the investment horizon of 90 days Tidal Trust II is expected to under-perform the Sanara Medtech. But the etf apears to be less risky and, when comparing its historical volatility, Tidal Trust II is 2.03 times less risky than Sanara Medtech. The etf trades about -0.03 of its potential returns per unit of risk. The Sanara Medtech is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  3,504  in Sanara Medtech on September 5, 2024 and sell it today you would earn a total of  132.00  from holding Sanara Medtech or generate 3.77% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Tidal Trust II  vs.  Sanara Medtech

Tidal Trust II

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Tidal Trust II has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Tidal Trust is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Sanara Medtech

Risk-Adjusted Performance

2 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Sanara Medtech are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, Sanara Medtech may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Tidal Trust and Sanara Medtech

The main advantage of trading using opposite Tidal Trust and Sanara Medtech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tidal Trust position performs unexpectedly, Sanara Medtech 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 Sanara Medtech will offset losses from the drop in Sanara Medtech's long position.

The idea behind Tidal Trust II and Sanara Medtech 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 Transaction History module to view history of all your transactions and understand their impact on performance.