Correlation Between Crinetics Pharmaceuticals and Aurora Cannabis
Can any of the company-specific risk be diversified away by investing in both Crinetics Pharmaceuticals and Aurora 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 Crinetics Pharmaceuticals and Aurora Cannabis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Crinetics Pharmaceuticals and Aurora Cannabis, you can compare the effects of market volatilities on Crinetics Pharmaceuticals and Aurora 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 Crinetics Pharmaceuticals with a short position of Aurora Cannabis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crinetics Pharmaceuticals and Aurora Cannabis.
Diversification Opportunities for Crinetics Pharmaceuticals and Aurora Cannabis
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Crinetics and Aurora is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Crinetics Pharmaceuticals and Aurora Cannabis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurora Cannabis and Crinetics Pharmaceuticals 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 Crinetics Pharmaceuticals are associated (or correlated) with Aurora Cannabis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurora Cannabis has no effect on the direction of Crinetics Pharmaceuticals i.e., Crinetics Pharmaceuticals and Aurora Cannabis go up and down completely randomly.
Pair Corralation between Crinetics Pharmaceuticals and Aurora Cannabis
Given the investment horizon of 90 days Crinetics Pharmaceuticals is expected to generate 0.92 times more return on investment than Aurora Cannabis. However, Crinetics Pharmaceuticals is 1.09 times less risky than Aurora Cannabis. It trades about -0.08 of its potential returns per unit of risk. Aurora Cannabis is currently generating about -0.15 per unit of risk. If you would invest 6,001 in Crinetics Pharmaceuticals on September 12, 2024 and sell it today you would lose (284.00) from holding Crinetics Pharmaceuticals or give up 4.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Crinetics Pharmaceuticals vs. Aurora Cannabis
Performance |
| Timeline |
| Crinetics Pharmaceuticals |
| Aurora Cannabis |
Crinetics Pharmaceuticals and Aurora Cannabis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Crinetics Pharmaceuticals and Aurora Cannabis
The main advantage of trading using opposite Crinetics Pharmaceuticals and Aurora Cannabis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Crinetics Pharmaceuticals position performs unexpectedly, Aurora 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 Aurora Cannabis will offset losses from the drop in Aurora Cannabis' long position.| Crinetics Pharmaceuticals vs. Viridian Therapeutics | Crinetics Pharmaceuticals vs. Cytokinetics | Crinetics Pharmaceuticals vs. Structure Therapeutics American | Crinetics Pharmaceuticals vs. Passage Bio |
| Aurora Cannabis vs. Evoke Pharma | Aurora Cannabis vs. Lantheus Holdings | Aurora Cannabis vs. ANI Pharmaceuticals | Aurora Cannabis vs. Ironwood Pharmaceuticals |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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