Correlation Between Cann American and MGC Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Cann American and MGC Pharmaceuticals 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 Cann American and MGC Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cann American Corp and MGC Pharmaceuticals, you can compare the effects of market volatilities on Cann American and MGC Pharmaceuticals 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 Cann American with a short position of MGC Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cann American and MGC Pharmaceuticals.
Diversification Opportunities for Cann American and MGC Pharmaceuticals
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Cann and MGC is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Cann American Corp and MGC Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MGC Pharmaceuticals and Cann American 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 Cann American Corp are associated (or correlated) with MGC Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MGC Pharmaceuticals has no effect on the direction of Cann American i.e., Cann American and MGC Pharmaceuticals go up and down completely randomly.
Pair Corralation between Cann American and MGC Pharmaceuticals
Given the investment horizon of 90 days Cann American is expected to generate 1.56 times less return on investment than MGC Pharmaceuticals. But when comparing it to its historical volatility, Cann American Corp is 2.82 times less risky than MGC Pharmaceuticals. It trades about 0.08 of its potential returns per unit of risk. MGC Pharmaceuticals is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 0.79 in MGC Pharmaceuticals on October 30, 2024 and sell it today you would earn a total of 20.21 from holding MGC Pharmaceuticals or generate 2558.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 71.98% |
| Values | Daily Returns |
Cann American Corp vs. MGC Pharmaceuticals
Performance |
| Timeline |
| Cann American Corp |
| MGC Pharmaceuticals |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Cann American and MGC Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cann American and MGC Pharmaceuticals
The main advantage of trading using opposite Cann American and MGC Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cann American position performs unexpectedly, MGC Pharmaceuticals 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 MGC Pharmaceuticals will offset losses from the drop in MGC Pharmaceuticals' long position.| Cann American vs. XCPCNL Business Services | Cann American vs. Golden Developing Solutions | Cann American vs. Indo Global Exchange | Cann American vs. Cgrowth Capital |
| MGC Pharmaceuticals vs. Target Group | MGC Pharmaceuticals vs. Aequus Pharmaceuticals | MGC Pharmaceuticals vs. Filament Health Corp | MGC Pharmaceuticals vs. Sky Century 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |