Correlation Between Agile Thrpe and Canopy Growth

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Can any of the company-specific risk be diversified away by investing in both Agile Thrpe and Canopy 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 Agile Thrpe and Canopy Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agile Thrpe and Canopy Growth Corp, you can compare the effects of market volatilities on Agile Thrpe and Canopy 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 Agile Thrpe with a short position of Canopy Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agile Thrpe and Canopy Growth.

Diversification Opportunities for Agile Thrpe and Canopy Growth

0.88
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Agile and Canopy is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Agile Thrpe and Canopy Growth Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canopy Growth Corp and Agile Thrpe 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 Agile Thrpe are associated (or correlated) with Canopy Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canopy Growth Corp has no effect on the direction of Agile Thrpe i.e., Agile Thrpe and Canopy Growth go up and down completely randomly.

Pair Corralation between Agile Thrpe and Canopy Growth

If you would invest  294.00  in Agile Thrpe on November 2, 2024 and sell it today you would earn a total of  0.00  from holding Agile Thrpe or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy5.26%
ValuesDaily Returns

Agile Thrpe  vs.  Canopy Growth Corp

 Performance 
       Timeline  
Agile Thrpe 

Risk-Adjusted Performance

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Weak
 
Strong
Very Weak
Over the last 90 days Agile Thrpe has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Agile Thrpe is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.
Canopy Growth Corp 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Canopy Growth Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in March 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Agile Thrpe and Canopy Growth Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Agile Thrpe and Canopy Growth

The main advantage of trading using opposite Agile Thrpe and Canopy Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agile Thrpe position performs unexpectedly, Canopy 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 Canopy Growth will offset losses from the drop in Canopy Growth's long position.
The idea behind Agile Thrpe and Canopy Growth Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.

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