Correlation Between Akanda Corp and CUMMINS
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By analyzing existing cross correlation between Akanda Corp and CUMMINS INC 4875, you can compare the effects of market volatilities on Akanda Corp and CUMMINS 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 CUMMINS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Akanda Corp and CUMMINS.
Diversification Opportunities for Akanda Corp and CUMMINS
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Akanda and CUMMINS is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Akanda Corp and CUMMINS INC 4875 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CUMMINS INC 4875 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 CUMMINS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CUMMINS INC 4875 has no effect on the direction of Akanda Corp i.e., Akanda Corp and CUMMINS go up and down completely randomly.
Pair Corralation between Akanda Corp and CUMMINS
Given the investment horizon of 90 days Akanda Corp is expected to under-perform the CUMMINS. But the stock apears to be less risky and, when comparing its historical volatility, Akanda Corp is 9.34 times less risky than CUMMINS. The stock trades about -0.05 of its potential returns per unit of risk. The CUMMINS INC 4875 is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 9,998 in CUMMINS INC 4875 on September 2, 2024 and sell it today you would earn a total of 83.00 from holding CUMMINS INC 4875 or generate 0.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 52.02% |
| Values | Daily Returns |
Akanda Corp vs. CUMMINS INC 4875
Performance |
| Timeline |
| Akanda Corp |
| CUMMINS INC 4875 |
Akanda Corp and CUMMINS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Akanda Corp and CUMMINS
The main advantage of trading using opposite Akanda Corp and CUMMINS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Akanda Corp position performs unexpectedly, CUMMINS 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 CUMMINS will offset losses from the drop in CUMMINS's long position.| Akanda Corp vs. China SXT Pharmaceuticals | Akanda Corp vs. Petros Pharmaceuticals | Akanda Corp vs. GelStat Corp | Akanda Corp vs. Shuttle Pharmaceuticals |
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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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