Correlation Between Benchmark Botanics and Avicanna
Can any of the company-specific risk be diversified away by investing in both Benchmark Botanics and Avicanna 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 Benchmark Botanics and Avicanna into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Benchmark Botanics and Avicanna, you can compare the effects of market volatilities on Benchmark Botanics and Avicanna 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 Benchmark Botanics with a short position of Avicanna. Check out your portfolio center. Please also check ongoing floating volatility patterns of Benchmark Botanics and Avicanna.
Diversification Opportunities for Benchmark Botanics and Avicanna
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Benchmark and Avicanna is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Benchmark Botanics and Avicanna in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avicanna and Benchmark Botanics 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 Benchmark Botanics are associated (or correlated) with Avicanna. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avicanna has no effect on the direction of Benchmark Botanics i.e., Benchmark Botanics and Avicanna go up and down completely randomly.
Pair Corralation between Benchmark Botanics and Avicanna
Assuming the 90 days horizon Benchmark Botanics is expected to generate 4.1 times more return on investment than Avicanna. However, Benchmark Botanics is 4.1 times more volatile than Avicanna. It trades about 0.04 of its potential returns per unit of risk. Avicanna is currently generating about 0.04 per unit of risk. If you would invest 1.00 in Benchmark Botanics on August 31, 2024 and sell it today you would lose (0.66) from holding Benchmark Botanics or give up 66.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.73% |
| Values | Daily Returns |
Benchmark Botanics vs. Avicanna
Performance |
| Timeline |
| Benchmark Botanics |
| Avicanna |
Benchmark Botanics and Avicanna Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Benchmark Botanics and Avicanna
The main advantage of trading using opposite Benchmark Botanics and Avicanna positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Benchmark Botanics position performs unexpectedly, Avicanna 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 Avicanna will offset losses from the drop in Avicanna's long position.| Benchmark Botanics vs. Speakeasy Cannabis Club | Benchmark Botanics vs. City View Green | Benchmark Botanics vs. BC Craft Supply | Benchmark Botanics vs. Ravenquest Biomed |
| Avicanna vs. Pharmacielo | Avicanna vs. Khiron Life Sciences | Avicanna vs. Flower One Holdings | Avicanna vs. Cansortium |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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