Correlation Between Barloworld and SNDL

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

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

Diversification Opportunities for Barloworld and SNDL

-0.2

Correlation Coefficient

Barloworld  SNDL

Good diversification

The 3 months correlation between Barloworld and SNDL is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Barloworld and SNDL Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SNDL Inc and Barloworld 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 Barloworld 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 Barloworld i.e., Barloworld and SNDL go up and down completely randomly.

Pair Corralation between Barloworld and SNDL

If you would invest  470.00  in Barloworld on October 25, 2024 and sell it today you would earn a total of  0.00  from holding Barloworld or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.67%
Values	Daily Returns

Barloworld  vs.  SNDL Inc

Barloworld

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Barloworld has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Barloworld is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

SNDL Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SNDL Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's fundamental indicators remain quite persistent which may send shares a bit higher in February 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Barloworld and SNDL

The main advantage of trading using opposite Barloworld and SNDL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barloworld 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 Barloworld 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.

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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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.