Correlation Between Ceragon Networks and Cambria Cannabis
Can any of the company-specific risk be diversified away by investing in both Ceragon Networks and Cambria 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 Ceragon Networks and Cambria Cannabis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ceragon Networks and Cambria Cannabis ETF, you can compare the effects of market volatilities on Ceragon Networks and Cambria 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 Ceragon Networks with a short position of Cambria Cannabis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ceragon Networks and Cambria Cannabis.
Diversification Opportunities for Ceragon Networks and Cambria Cannabis
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ceragon and Cambria is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Ceragon Networks and Cambria Cannabis ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cambria Cannabis ETF and Ceragon Networks 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 Ceragon Networks are associated (or correlated) with Cambria Cannabis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cambria Cannabis ETF has no effect on the direction of Ceragon Networks i.e., Ceragon Networks and Cambria Cannabis go up and down completely randomly.
Pair Corralation between Ceragon Networks and Cambria Cannabis
Given the investment horizon of 90 days Ceragon Networks is expected to generate 1.71 times more return on investment than Cambria Cannabis. However, Ceragon Networks is 1.71 times more volatile than Cambria Cannabis ETF. It trades about 0.47 of its potential returns per unit of risk. Cambria Cannabis ETF is currently generating about -0.1 per unit of risk. If you would invest 242.00 in Ceragon Networks on September 4, 2024 and sell it today you would earn a total of 174.00 from holding Ceragon Networks or generate 71.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ceragon Networks vs. Cambria Cannabis ETF
Performance |
| Timeline |
| Ceragon Networks |
| Cambria Cannabis ETF |
Ceragon Networks and Cambria Cannabis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ceragon Networks and Cambria Cannabis
The main advantage of trading using opposite Ceragon Networks and Cambria Cannabis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ceragon Networks position performs unexpectedly, Cambria 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 Cambria Cannabis will offset losses from the drop in Cambria Cannabis' long position.| Ceragon Networks vs. Cambium Networks Corp | Ceragon Networks vs. KVH Industries | Ceragon Networks vs. Knowles Cor | Ceragon Networks vs. AudioCodes |
| Cambria Cannabis vs. Managed Account Series | Cambria Cannabis vs. Fidelity Sai International | Cambria Cannabis vs. Schwab Strategic Trust | Cambria Cannabis vs. Inpex Corp ADR |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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