Correlation Between Akanda Corp and PetIQ
Can any of the company-specific risk be diversified away by investing in both Akanda Corp and PetIQ 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 Akanda Corp and PetIQ into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Akanda Corp and PetIQ Inc, you can compare the effects of market volatilities on Akanda Corp and PetIQ 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 Akanda Corp with a short position of PetIQ. Check out your portfolio center. Please also check ongoing floating volatility patterns of Akanda Corp and PetIQ.
Diversification Opportunities for Akanda Corp and PetIQ
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Akanda and PetIQ is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Akanda Corp and PetIQ Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PetIQ Inc and Akanda Corp 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 Akanda Corp are associated (or correlated) with PetIQ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PetIQ Inc has no effect on the direction of Akanda Corp i.e., Akanda Corp and PetIQ go up and down completely randomly.
Pair Corralation between Akanda Corp and PetIQ
Given the investment horizon of 90 days Akanda Corp is expected to under-perform the PetIQ. In addition to that, Akanda Corp is 2.64 times more volatile than PetIQ Inc. It trades about -0.06 of its total potential returns per unit of risk. PetIQ Inc is currently generating about 0.08 per unit of volatility. If you would invest 1,367 in PetIQ Inc on August 31, 2024 and sell it today you would earn a total of 1,731 from holding PetIQ Inc or generate 126.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 93.32% |
| Values | Daily Returns |
Akanda Corp vs. PetIQ Inc
Performance |
| Timeline |
| Akanda Corp |
| PetIQ Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Strong
Akanda Corp and PetIQ Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Akanda Corp and PetIQ
The main advantage of trading using opposite Akanda Corp and PetIQ positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Akanda Corp position performs unexpectedly, PetIQ 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 PetIQ will offset losses from the drop in PetIQ's long position.The idea behind Akanda Corp and PetIQ Inc 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.| PetIQ vs. Prestige Brand Holdings | PetIQ vs. Collegium Pharmaceutical | PetIQ vs. Regencell Bioscience Holdings | PetIQ vs. Pacira BioSciences, |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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