Correlation Between SNDL and Anterix

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

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

Diversification Opportunities for SNDL and Anterix

0.2

Correlation Coefficient

SNDL  Anterix

Modest diversification

The 3 months correlation between SNDL and Anterix is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding SNDL Inc and Anterix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anterix and SNDL 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 SNDL Inc are associated (or correlated) with Anterix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anterix has no effect on the direction of SNDL i.e., SNDL and Anterix go up and down completely randomly.

Pair Corralation between SNDL and Anterix

Given the investment horizon of 90 days SNDL Inc is expected to generate 1.61 times more return on investment than Anterix. However, SNDL is 1.61 times more volatile than Anterix. It trades about 0.01 of its potential returns per unit of risk. Anterix is currently generating about 0.01 per unit of risk. If you would invest  212.00  in SNDL Inc on September 26, 2024 and sell it today you would lose (30.00) from holding SNDL Inc or give up 14.15% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	99.8%
Values	Daily Returns

SNDL Inc  vs.  Anterix

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 quite persistent fundamental indicators, SNDL is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Anterix

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Anterix has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's technical and fundamental indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with SNDL and Anterix

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

The idea behind SNDL Inc and Anterix 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.