Correlation Between Cronos and Curaleaf Holdings
Can any of the company-specific risk be diversified away by investing in both Cronos and Curaleaf Holdings 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 Cronos and Curaleaf Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cronos Group and Curaleaf Holdings, you can compare the effects of market volatilities on Cronos and Curaleaf Holdings 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 Cronos with a short position of Curaleaf Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cronos and Curaleaf Holdings.
Diversification Opportunities for Cronos and Curaleaf Holdings
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Cronos and Curaleaf is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Cronos Group and Curaleaf Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Curaleaf Holdings and Cronos 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 Cronos Group are associated (or correlated) with Curaleaf Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Curaleaf Holdings has no effect on the direction of Cronos i.e., Cronos and Curaleaf Holdings go up and down completely randomly.
Pair Corralation between Cronos and Curaleaf Holdings
Given the investment horizon of 90 days Cronos Group is expected to generate 0.45 times more return on investment than Curaleaf Holdings. However, Cronos Group is 2.23 times less risky than Curaleaf Holdings. It trades about -0.04 of its potential returns per unit of risk. Curaleaf Holdings is currently generating about -0.09 per unit of risk. If you would invest 224.00 in Cronos Group on November 2, 2024 and sell it today you would lose (31.00) from holding Cronos Group or give up 13.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cronos Group vs. Curaleaf Holdings
Performance |
| Timeline |
| Cronos Group |
| Curaleaf Holdings |
Cronos and Curaleaf Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cronos and Curaleaf Holdings
The main advantage of trading using opposite Cronos and Curaleaf Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cronos position performs unexpectedly, Curaleaf Holdings 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 Curaleaf Holdings will offset losses from the drop in Curaleaf Holdings' long position.| Cronos vs. OrganiGram Holdings | Cronos vs. Aurora Cannabis | Cronos vs. SNDL Inc | Cronos vs. Canopy Growth Corp |
| Curaleaf Holdings vs. Green Thumb Industries | Curaleaf Holdings vs. Cresco Labs | Curaleaf Holdings vs. Trulieve Cannabis Corp | Curaleaf Holdings vs. Cronos Group |
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 Stocks Directory module to find actively traded stocks across global markets.
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