Correlation Between Auxly Cannabis and Sanyo Chemical
Can any of the company-specific risk be diversified away by investing in both Auxly Cannabis and Sanyo Chemical 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 Sanyo Chemical 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 Sanyo Chemical Industries, you can compare the effects of market volatilities on Auxly Cannabis and Sanyo Chemical 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 Sanyo Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auxly Cannabis and Sanyo Chemical.
Diversification Opportunities for Auxly Cannabis and Sanyo Chemical
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Auxly and Sanyo is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Auxly Cannabis Group and Sanyo Chemical Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sanyo Chemical Industries 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 Sanyo Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sanyo Chemical Industries has no effect on the direction of Auxly Cannabis i.e., Auxly Cannabis and Sanyo Chemical go up and down completely randomly.
Pair Corralation between Auxly Cannabis and Sanyo Chemical
Assuming the 90 days horizon Auxly Cannabis Group is expected to generate 42.73 times more return on investment than Sanyo Chemical. However, Auxly Cannabis is 42.73 times more volatile than Sanyo Chemical Industries. It trades about 0.1 of its potential returns per unit of risk. Sanyo Chemical Industries is currently generating about 0.1 per unit of risk. If you would invest 2.54 in Auxly Cannabis Group on September 13, 2024 and sell it today you would lose (1.48) from holding Auxly Cannabis Group or give up 58.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Auxly Cannabis Group vs. Sanyo Chemical Industries
Performance |
| Timeline |
| Auxly Cannabis Group |
| Sanyo Chemical Industries |
Auxly Cannabis and Sanyo Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Auxly Cannabis and Sanyo Chemical
The main advantage of trading using opposite Auxly Cannabis and Sanyo Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auxly Cannabis position performs unexpectedly, Sanyo Chemical 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 Sanyo Chemical will offset losses from the drop in Sanyo Chemical's long position.| Auxly Cannabis vs. PLAYMATES TOYS | Auxly Cannabis vs. FUTURE GAMING GRP | Auxly Cannabis vs. TITANIUM TRANSPORTGROUP | Auxly Cannabis vs. Fukuyama Transporting Co |
| Sanyo Chemical vs. Albemarle | Sanyo Chemical vs. Superior Plus Corp | Sanyo Chemical vs. SIVERS SEMICONDUCTORS AB | Sanyo Chemical vs. Norsk Hydro ASA |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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