Correlation Between Elixinol Global and Golden Developing
Can any of the company-specific risk be diversified away by investing in both Elixinol Global and Golden Developing 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 Elixinol Global and Golden Developing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elixinol Global and Golden Developing Solutions, you can compare the effects of market volatilities on Elixinol Global and Golden Developing 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 Elixinol Global with a short position of Golden Developing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elixinol Global and Golden Developing.
Diversification Opportunities for Elixinol Global and Golden Developing
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Elixinol and Golden is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Elixinol Global and Golden Developing Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Developing and Elixinol Global 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 Elixinol Global are associated (or correlated) with Golden Developing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Developing has no effect on the direction of Elixinol Global i.e., Elixinol Global and Golden Developing go up and down completely randomly.
Pair Corralation between Elixinol Global and Golden Developing
Assuming the 90 days horizon Elixinol Global is expected to generate 5.98 times more return on investment than Golden Developing. However, Elixinol Global is 5.98 times more volatile than Golden Developing Solutions. It trades about 0.14 of its potential returns per unit of risk. Golden Developing Solutions is currently generating about 0.05 per unit of risk. If you would invest 0.66 in Elixinol Global on September 12, 2024 and sell it today you would earn a total of 1.90 from holding Elixinol Global or generate 287.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.7% |
| Values | Daily Returns |
Elixinol Global vs. Golden Developing Solutions
Performance |
| Timeline |
| Elixinol Global |
| Golden Developing |
Elixinol Global and Golden Developing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elixinol Global and Golden Developing
The main advantage of trading using opposite Elixinol Global and Golden Developing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elixinol Global position performs unexpectedly, Golden Developing 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 Golden Developing will offset losses from the drop in Golden Developing's long position.| Elixinol Global vs. Pharmadrug | Elixinol Global vs. Livewire Ergogenics | Elixinol Global vs. Agra Ventures | Elixinol Global vs. BellRock Brands |
| Golden Developing vs. 4Front Ventures Corp | Golden Developing vs. Khiron Life Sciences | Golden Developing vs. BellRock Brands | Golden Developing vs. Elixinol Global |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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