Correlation Between Cann American and YourWay Cannabis
Can any of the company-specific risk be diversified away by investing in both Cann American and YourWay Cannabis 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 YourWay Cannabis 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 YourWay Cannabis Brands, you can compare the effects of market volatilities on Cann American and YourWay Cannabis 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 YourWay Cannabis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cann American and YourWay Cannabis.
Diversification Opportunities for Cann American and YourWay Cannabis
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Cann and YourWay is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Cann American Corp and YourWay Cannabis Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YourWay Cannabis Brands 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 YourWay Cannabis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YourWay Cannabis Brands has no effect on the direction of Cann American i.e., Cann American and YourWay Cannabis go up and down completely randomly.
Pair Corralation between Cann American and YourWay Cannabis
Given the investment horizon of 90 days Cann American Corp is expected to generate 3.45 times more return on investment than YourWay Cannabis. However, Cann American is 3.45 times more volatile than YourWay Cannabis Brands. It trades about 0.09 of its potential returns per unit of risk. YourWay Cannabis Brands is currently generating about -0.06 per unit of risk. If you would invest 0.25 in Cann American Corp on September 4, 2024 and sell it today you would earn a total of 0.05 from holding Cann American Corp or generate 20.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.26% |
| Values | Daily Returns |
Cann American Corp vs. YourWay Cannabis Brands
Performance |
| Timeline |
| Cann American Corp |
| YourWay Cannabis Brands |
Cann American and YourWay Cannabis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cann American and YourWay Cannabis
The main advantage of trading using opposite Cann American and YourWay Cannabis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cann American position performs unexpectedly, YourWay Cannabis 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 YourWay Cannabis will offset losses from the drop in YourWay Cannabis' 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 |
| YourWay Cannabis vs. Decibel Cannabis | YourWay Cannabis vs. Delta 9 Cannabis | YourWay Cannabis vs. Body and Mind | YourWay Cannabis vs. CLS Holdings USA |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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