Correlation Between China Infrastructure and Medicine Man
Can any of the company-specific risk be diversified away by investing in both China Infrastructure and Medicine Man 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 China Infrastructure and Medicine Man into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Infrastructure Construction and Medicine Man Technologies, you can compare the effects of market volatilities on China Infrastructure and Medicine Man 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 China Infrastructure with a short position of Medicine Man. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Infrastructure and Medicine Man.
Diversification Opportunities for China Infrastructure and Medicine Man
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between China and Medicine is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding China Infrastructure Construct and Medicine Man Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Medicine Man Technologies and China Infrastructure 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 China Infrastructure Construction are associated (or correlated) with Medicine Man. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Medicine Man Technologies has no effect on the direction of China Infrastructure i.e., China Infrastructure and Medicine Man go up and down completely randomly.
Pair Corralation between China Infrastructure and Medicine Man
If you would invest 11.00 in Medicine Man Technologies on September 1, 2024 and sell it today you would lose (1.00) from holding Medicine Man Technologies or give up 9.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
China Infrastructure Construct vs. Medicine Man Technologies
Performance |
| Timeline |
| China Infrastructure |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Medicine Man Technologies |
China Infrastructure and Medicine Man Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Infrastructure and Medicine Man
The main advantage of trading using opposite China Infrastructure and Medicine Man positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Infrastructure position performs unexpectedly, Medicine Man 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 Medicine Man will offset losses from the drop in Medicine Man's long position.| China Infrastructure vs. Medicine Man Technologies | China Infrastructure vs. Kona Gold Solutions | China Infrastructure vs. Green Thumb Industries | China Infrastructure vs. Cann American Corp |
| Medicine Man vs. Lowell Farms | Medicine Man vs. AYR Strategies Class | Medicine Man vs. 4Front Ventures Corp | Medicine Man vs. Verano Holdings Corp |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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