Correlation Between Cronos and Genomma Lab
Can any of the company-specific risk be diversified away by investing in both Cronos and Genomma Lab 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 Genomma Lab into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cronos Group and Genomma Lab Internacional, you can compare the effects of market volatilities on Cronos and Genomma Lab 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 Genomma Lab. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cronos and Genomma Lab.
Diversification Opportunities for Cronos and Genomma Lab
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Cronos and Genomma is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Cronos Group and Genomma Lab Internacional in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genomma Lab Internacional 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 Genomma Lab. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genomma Lab Internacional has no effect on the direction of Cronos i.e., Cronos and Genomma Lab go up and down completely randomly.
Pair Corralation between Cronos and Genomma Lab
Given the investment horizon of 90 days Cronos is expected to generate 9.26 times less return on investment than Genomma Lab. In addition to that, Cronos is 1.62 times more volatile than Genomma Lab Internacional. It trades about 0.01 of its total potential returns per unit of risk. Genomma Lab Internacional is currently generating about 0.21 per unit of volatility. If you would invest 113.00 in Genomma Lab Internacional on September 1, 2024 and sell it today you would earn a total of 14.00 from holding Genomma Lab Internacional or generate 12.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Cronos Group vs. Genomma Lab Internacional
Performance |
| Timeline |
| Cronos Group |
| Genomma Lab Internacional |
Cronos and Genomma Lab Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cronos and Genomma Lab
The main advantage of trading using opposite Cronos and Genomma Lab positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cronos position performs unexpectedly, Genomma Lab 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 Genomma Lab will offset losses from the drop in Genomma Lab's long position.| Cronos vs. OrganiGram Holdings | Cronos vs. Aurora Cannabis | Cronos vs. SNDL Inc | Cronos vs. Canopy Growth Corp |
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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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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