Correlation Between City View and CordovaCann Corp
Can any of the company-specific risk be diversified away by investing in both City View and CordovaCann Corp 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 City View and CordovaCann Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between City View Green and CordovaCann Corp, you can compare the effects of market volatilities on City View and CordovaCann Corp 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 City View with a short position of CordovaCann Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of City View and CordovaCann Corp.
Diversification Opportunities for City View and CordovaCann Corp
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between City and CordovaCann is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding City View Green and CordovaCann Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CordovaCann Corp and City View 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 City View Green are associated (or correlated) with CordovaCann Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CordovaCann Corp has no effect on the direction of City View i.e., City View and CordovaCann Corp go up and down completely randomly.
Pair Corralation between City View and CordovaCann Corp
Assuming the 90 days horizon City View Green is expected to generate 1.44 times more return on investment than CordovaCann Corp. However, City View is 1.44 times more volatile than CordovaCann Corp. It trades about 0.21 of its potential returns per unit of risk. CordovaCann Corp is currently generating about 0.07 per unit of risk. If you would invest 0.69 in City View Green on September 2, 2024 and sell it today you would earn a total of 0.66 from holding City View Green or generate 95.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
City View Green vs. CordovaCann Corp
Performance |
| Timeline |
| City View Green |
| CordovaCann Corp |
City View and CordovaCann Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with City View and CordovaCann Corp
The main advantage of trading using opposite City View and CordovaCann Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if City View position performs unexpectedly, CordovaCann Corp 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 CordovaCann Corp will offset losses from the drop in CordovaCann Corp's long position.| City View vs. Holloman Energy Corp | City View vs. cbdMD Inc | City View vs. Evolus Inc | City View vs. CV Sciences |
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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 Transaction History module to view history of all your transactions and understand their impact on performance.
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