Correlation Between Acreage Holdings and Medipharm Labs
Can any of the company-specific risk be diversified away by investing in both Acreage Holdings and Medipharm Labs 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 Acreage Holdings and Medipharm Labs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acreage Holdings and Medipharm Labs Corp, you can compare the effects of market volatilities on Acreage Holdings and Medipharm Labs 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 Acreage Holdings with a short position of Medipharm Labs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acreage Holdings and Medipharm Labs.
Diversification Opportunities for Acreage Holdings and Medipharm Labs
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Acreage and Medipharm is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Acreage Holdings and Medipharm Labs Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Medipharm Labs Corp and Acreage Holdings 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 Acreage Holdings are associated (or correlated) with Medipharm Labs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Medipharm Labs Corp has no effect on the direction of Acreage Holdings i.e., Acreage Holdings and Medipharm Labs go up and down completely randomly.
Pair Corralation between Acreage Holdings and Medipharm Labs
Assuming the 90 days horizon Acreage Holdings is expected to generate 2.71 times more return on investment than Medipharm Labs. However, Acreage Holdings is 2.71 times more volatile than Medipharm Labs Corp. It trades about 0.01 of its potential returns per unit of risk. Medipharm Labs Corp is currently generating about 0.01 per unit of risk. If you would invest 135.00 in Acreage Holdings on August 29, 2024 and sell it today you would lose (126.00) from holding Acreage Holdings or give up 93.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Acreage Holdings vs. Medipharm Labs Corp
Performance |
| Timeline |
| Acreage Holdings |
| Medipharm Labs Corp |
Acreage Holdings and Medipharm Labs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acreage Holdings and Medipharm Labs
The main advantage of trading using opposite Acreage Holdings and Medipharm Labs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acreage Holdings position performs unexpectedly, Medipharm Labs 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 Medipharm Labs will offset losses from the drop in Medipharm Labs' long position.| Acreage Holdings vs. AYR Strategies Class | Acreage Holdings vs. RIV Capital | Acreage Holdings vs. Verano Holdings Corp | Acreage Holdings vs. BZAM |
| Medipharm Labs vs. Green Cures Botanical | Medipharm Labs vs. Cann American Corp | Medipharm Labs vs. Rimrock Gold Corp | Medipharm Labs vs. Galexxy Holdings |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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