Correlation Between Codexis and Sadot

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

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

Diversification Opportunities for Codexis and Sadot

0.52

Correlation Coefficient

Codexis  Sadot

Very weak diversification

The 3 months correlation between Codexis and Sadot is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Codexis and Sadot Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sadot Group and Codexis 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 Codexis are associated (or correlated) with Sadot. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sadot Group has no effect on the direction of Codexis i.e., Codexis and Sadot go up and down completely randomly.

Pair Corralation between Codexis and Sadot

Given the investment horizon of 90 days Codexis is expected to under-perform the Sadot. In addition to that, Codexis is 1.3 times more volatile than Sadot Group. It trades about -0.19 of its total potential returns per unit of risk. Sadot Group is currently generating about -0.08 per unit of volatility. If you would invest  372.00  in Sadot Group on December 19, 2024 and sell it today you would lose (75.00) from holding Sadot Group or give up 20.16% of portfolio value over 90 days.

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

Codexis  vs.  Sadot Group

Codexis

Risk-Adjusted Performance

Very Weak

Over the last 90 days Codexis has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Sadot Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Sadot Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Codexis and Sadot

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

The idea behind Codexis and Sadot Group 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.