Correlation Between Cannabis Suisse and China Infrastructure

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Can any of the company-specific risk be diversified away by investing in both Cannabis Suisse and China Infrastructure 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 Cannabis Suisse and China Infrastructure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cannabis Suisse Corp and China Infrastructure Construction, you can compare the effects of market volatilities on Cannabis Suisse and China Infrastructure 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 Cannabis Suisse with a short position of China Infrastructure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cannabis Suisse and China Infrastructure.

Diversification Opportunities for Cannabis Suisse and China Infrastructure

0.08
  Correlation Coefficient

Significant diversification

The 3 months correlation between Cannabis and China is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Cannabis Suisse Corp and China Infrastructure Construct in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Infrastructure and Cannabis Suisse 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 Cannabis Suisse Corp are associated (or correlated) with China Infrastructure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Infrastructure has no effect on the direction of Cannabis Suisse i.e., Cannabis Suisse and China Infrastructure go up and down completely randomly.

Pair Corralation between Cannabis Suisse and China Infrastructure

If you would invest  2.30  in Cannabis Suisse Corp on August 29, 2024 and sell it today you would lose (0.40) from holding Cannabis Suisse Corp or give up 17.39% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy0.32%
ValuesDaily Returns

Cannabis Suisse Corp  vs.  China Infrastructure Construct

 Performance 
       Timeline  
Cannabis Suisse Corp 

Risk-Adjusted Performance

10 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Cannabis Suisse Corp are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite fairly unfluctuating basic indicators, Cannabis Suisse demonstrated solid returns over the last few months and may actually be approaching a breakup point.
China Infrastructure 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days China Infrastructure Construction has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, China Infrastructure is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Cannabis Suisse and China Infrastructure Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Cannabis Suisse and China Infrastructure

The main advantage of trading using opposite Cannabis Suisse and China Infrastructure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cannabis Suisse position performs unexpectedly, China Infrastructure 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 China Infrastructure will offset losses from the drop in China Infrastructure's long position.
The idea behind Cannabis Suisse Corp and China Infrastructure Construction pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.

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