Correlation Between AgriFORCE Growing and Greenlane Holdings
Can any of the company-specific risk be diversified away by investing in both AgriFORCE Growing and Greenlane Holdings 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 AgriFORCE Growing and Greenlane Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AgriFORCE Growing Systems and Greenlane Holdings, you can compare the effects of market volatilities on AgriFORCE Growing and Greenlane Holdings 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 AgriFORCE Growing with a short position of Greenlane Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of AgriFORCE Growing and Greenlane Holdings.
Diversification Opportunities for AgriFORCE Growing and Greenlane Holdings
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AgriFORCE and Greenlane is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding AgriFORCE Growing Systems and Greenlane Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greenlane Holdings and AgriFORCE Growing 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 AgriFORCE Growing Systems are associated (or correlated) with Greenlane Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greenlane Holdings has no effect on the direction of AgriFORCE Growing i.e., AgriFORCE Growing and Greenlane Holdings go up and down completely randomly.
Pair Corralation between AgriFORCE Growing and Greenlane Holdings
Given the investment horizon of 90 days AgriFORCE Growing Systems is expected to under-perform the Greenlane Holdings. But the stock apears to be less risky and, when comparing its historical volatility, AgriFORCE Growing Systems is 2.19 times less risky than Greenlane Holdings. The stock trades about -0.13 of its potential returns per unit of risk. The Greenlane Holdings is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 3,850 in Greenlane Holdings on August 28, 2024 and sell it today you would lose (3,661) from holding Greenlane Holdings or give up 95.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AgriFORCE Growing Systems vs. Greenlane Holdings
Performance |
| Timeline |
| AgriFORCE Growing Systems |
| Greenlane Holdings |
AgriFORCE Growing and Greenlane Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AgriFORCE Growing and Greenlane Holdings
The main advantage of trading using opposite AgriFORCE Growing and Greenlane Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AgriFORCE Growing position performs unexpectedly, Greenlane Holdings 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 Greenlane Holdings will offset losses from the drop in Greenlane Holdings' long position.| AgriFORCE Growing vs. Limoneira Co | AgriFORCE Growing vs. Forafric Global PLC | AgriFORCE Growing vs. Australian Agricultural | AgriFORCE Growing vs. NaturalShrimp |
| Greenlane Holdings vs. Steven Madden | Greenlane Holdings vs. Vera Bradley | Greenlane Holdings vs. Caleres | Greenlane Holdings vs. Rocky Brands |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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