Correlation Between SNDL and Contextlogic

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

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

Diversification Opportunities for SNDL and Contextlogic

0.22

Correlation Coefficient

SNDL  Contextlogic

Modest diversification

The 3 months correlation between SNDL and Contextlogic is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding SNDL Inc and Contextlogic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Contextlogic 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 Contextlogic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Contextlogic has no effect on the direction of SNDL i.e., SNDL and Contextlogic go up and down completely randomly.

Pair Corralation between SNDL and Contextlogic

Given the investment horizon of 90 days SNDL Inc is expected to generate 0.96 times more return on investment than Contextlogic. However, SNDL Inc is 1.04 times less risky than Contextlogic. It trades about 0.1 of its potential returns per unit of risk. Contextlogic is currently generating about 0.06 per unit of risk. If you would invest  135.00  in SNDL Inc on May 5, 2025 and sell it today you would earn a total of  30.00  from holding SNDL Inc or generate 22.22% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	53.97%
Values	Daily Returns

SNDL Inc  vs.  Contextlogic

SNDL Inc

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SNDL Inc are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite weak fundamental indicators, SNDL disclosed solid returns over the last few months and may actually be approaching a breakup point.

Contextlogic

Risk-Adjusted Performance

Modest

Over the last 90 days Contextlogic has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather unfluctuating technical and fundamental indicators, Contextlogic exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with SNDL and Contextlogic

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

The idea behind SNDL Inc and Contextlogic 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 Global Correlations module to find global opportunities by holding instruments from different markets.