Correlation Between Acorda Therapeutics and Flora Growth
Can any of the company-specific risk be diversified away by investing in both Acorda Therapeutics and Flora Growth 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 Acorda Therapeutics and Flora Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acorda Therapeutics and Flora Growth Corp, you can compare the effects of market volatilities on Acorda Therapeutics and Flora Growth 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 Acorda Therapeutics with a short position of Flora Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acorda Therapeutics and Flora Growth.
Diversification Opportunities for Acorda Therapeutics and Flora Growth
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Acorda and Flora is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Acorda Therapeutics and Flora Growth Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Flora Growth Corp and Acorda Therapeutics 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 Acorda Therapeutics are associated (or correlated) with Flora Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Flora Growth Corp has no effect on the direction of Acorda Therapeutics i.e., Acorda Therapeutics and Flora Growth go up and down completely randomly.
Pair Corralation between Acorda Therapeutics and Flora Growth
Given the investment horizon of 90 days Acorda Therapeutics is expected to generate 1.0 times more return on investment than Flora Growth. However, Acorda Therapeutics is 1.0 times less risky than Flora Growth. It trades about 0.06 of its potential returns per unit of risk. Flora Growth Corp is currently generating about 0.0 per unit of risk. If you would invest 1,176 in Acorda Therapeutics on August 26, 2024 and sell it today you would earn a total of 444.00 from holding Acorda Therapeutics or generate 37.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 31.99% |
| Values | Daily Returns |
Acorda Therapeutics vs. Flora Growth Corp
Performance |
| Timeline |
| Acorda Therapeutics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Flora Growth Corp |
Acorda Therapeutics and Flora Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acorda Therapeutics and Flora Growth
The main advantage of trading using opposite Acorda Therapeutics and Flora Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acorda Therapeutics position performs unexpectedly, Flora Growth 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 Flora Growth will offset losses from the drop in Flora Growth's long position.| Acorda Therapeutics vs. Shionogi Co | Acorda Therapeutics vs. Pacira BioSciences, | Acorda Therapeutics vs. Sunshine Biopharma Warrant | Acorda Therapeutics vs. Biofrontera |
| Flora Growth vs. Eliem Therapeutics | Flora Growth vs. HCW Biologics | Flora Growth vs. Scpharmaceuticals | Flora Growth vs. Milestone Pharmaceuticals |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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