Correlation Between Golden Developing and Integrated Cannabis
Can any of the company-specific risk be diversified away by investing in both Golden Developing and Integrated 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 Golden Developing and Integrated Cannabis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Golden Developing Solutions and Integrated Cannabis Solutions, you can compare the effects of market volatilities on Golden Developing and Integrated 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 Golden Developing with a short position of Integrated Cannabis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Golden Developing and Integrated Cannabis.
Diversification Opportunities for Golden Developing and Integrated Cannabis
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Golden and Integrated is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Golden Developing Solutions and Integrated Cannabis Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Integrated Cannabis and Golden Developing 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 Golden Developing Solutions are associated (or correlated) with Integrated Cannabis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Integrated Cannabis has no effect on the direction of Golden Developing i.e., Golden Developing and Integrated Cannabis go up and down completely randomly.
Pair Corralation between Golden Developing and Integrated Cannabis
Given the investment horizon of 90 days Golden Developing is expected to generate 4.37 times less return on investment than Integrated Cannabis. But when comparing it to its historical volatility, Golden Developing Solutions is 1.05 times less risky than Integrated Cannabis. It trades about 0.02 of its potential returns per unit of risk. Integrated Cannabis Solutions is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 0.15 in Integrated Cannabis Solutions on August 29, 2024 and sell it today you would earn a total of 0.18 from holding Integrated Cannabis Solutions or generate 120.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Golden Developing Solutions vs. Integrated Cannabis Solutions
Performance |
| Timeline |
| Golden Developing |
| Integrated Cannabis |
Golden Developing and Integrated Cannabis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Golden Developing and Integrated Cannabis
The main advantage of trading using opposite Golden Developing and Integrated Cannabis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Golden Developing position performs unexpectedly, Integrated 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 Integrated Cannabis will offset losses from the drop in Integrated Cannabis' long position.| Golden Developing vs. Cann American Corp | Golden Developing vs. GelStat Corp | Golden Developing vs. Green Cures Botanical | Golden Developing vs. Rimrock Gold Corp |
| Integrated Cannabis vs. Speakeasy Cannabis Club | Integrated Cannabis vs. City View Green | Integrated Cannabis vs. Benchmark Botanics | Integrated Cannabis vs. Ravenquest Biomed |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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