Correlation Between Coupang LLC and SunOpta

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

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

Diversification Opportunities for Coupang LLC and SunOpta

-0.51

Correlation Coefficient

Coupang LLC  SunOpta

Excellent diversification

The 3 months correlation between Coupang and SunOpta is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Coupang LLC and SunOpta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SunOpta and Coupang LLC 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 Coupang LLC are associated (or correlated) with SunOpta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SunOpta has no effect on the direction of Coupang LLC i.e., Coupang LLC and SunOpta go up and down completely randomly.

Pair Corralation between Coupang LLC and SunOpta

Given the investment horizon of 90 days Coupang LLC is expected to generate 0.9 times more return on investment than SunOpta. However, Coupang LLC is 1.11 times less risky than SunOpta. It trades about 0.22 of its potential returns per unit of risk. SunOpta is currently generating about -0.18 per unit of risk. If you would invest  1,760  in Coupang LLC on February 24, 2024 and sell it today you would earn a total of  476.00  from holding Coupang LLC or generate 27.05% return on investment over 90 days.

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

Coupang LLC  vs.  SunOpta

Coupang LLC

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Coupang LLC are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, Coupang LLC reported solid returns over the last few months and may actually be approaching a breakup point.

SunOpta

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SunOpta has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's forward-looking signals remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Pair Trading with Coupang LLC and SunOpta

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

The idea behind Coupang LLC and SunOpta 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.