Correlation Between Auxly Cannabis and HOME DEPOT
Can any of the company-specific risk be diversified away by investing in both Auxly Cannabis and HOME DEPOT 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 Auxly Cannabis and HOME DEPOT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Auxly Cannabis Group and HOME DEPOT, you can compare the effects of market volatilities on Auxly Cannabis and HOME DEPOT 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 Auxly Cannabis with a short position of HOME DEPOT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auxly Cannabis and HOME DEPOT.
Diversification Opportunities for Auxly Cannabis and HOME DEPOT
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Auxly and HOME is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Auxly Cannabis Group and HOME DEPOT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HOME DEPOT and Auxly Cannabis 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 Auxly Cannabis Group are associated (or correlated) with HOME DEPOT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HOME DEPOT has no effect on the direction of Auxly Cannabis i.e., Auxly Cannabis and HOME DEPOT go up and down completely randomly.
Pair Corralation between Auxly Cannabis and HOME DEPOT
Assuming the 90 days horizon Auxly Cannabis is expected to generate 1.09 times less return on investment than HOME DEPOT. In addition to that, Auxly Cannabis is 9.43 times more volatile than HOME DEPOT. It trades about 0.02 of its total potential returns per unit of risk. HOME DEPOT is currently generating about 0.17 per unit of volatility. If you would invest 37,715 in HOME DEPOT on November 4, 2024 and sell it today you would earn a total of 1,880 from holding HOME DEPOT or generate 4.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Auxly Cannabis Group vs. HOME DEPOT
Performance |
| Timeline |
| Auxly Cannabis Group |
| HOME DEPOT |
Auxly Cannabis and HOME DEPOT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Auxly Cannabis and HOME DEPOT
The main advantage of trading using opposite Auxly Cannabis and HOME DEPOT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auxly Cannabis position performs unexpectedly, HOME DEPOT 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 HOME DEPOT will offset losses from the drop in HOME DEPOT's long position.| Auxly Cannabis vs. Waste Management | Auxly Cannabis vs. Aedas Homes SA | Auxly Cannabis vs. RCI Hospitality Holdings | Auxly Cannabis vs. Autohome ADR |
| HOME DEPOT vs. DICKS Sporting Goods | HOME DEPOT vs. Hemisphere Energy Corp | HOME DEPOT vs. Zoom Video Communications | HOME DEPOT vs. USWE SPORTS AB |
Check out your portfolio center.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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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