Correlation Between Elixinol Global and HLS Therapeutics
Can any of the company-specific risk be diversified away by investing in both Elixinol Global and HLS Therapeutics 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 HLS Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elixinol Global and HLS Therapeutics, you can compare the effects of market volatilities on Elixinol Global and HLS Therapeutics 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 HLS Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elixinol Global and HLS Therapeutics.
Diversification Opportunities for Elixinol Global and HLS Therapeutics
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Elixinol and HLS is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Elixinol Global and HLS Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HLS Therapeutics 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 HLS Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HLS Therapeutics has no effect on the direction of Elixinol Global i.e., Elixinol Global and HLS Therapeutics go up and down completely randomly.
Pair Corralation between Elixinol Global and HLS Therapeutics
Assuming the 90 days horizon Elixinol Global is expected to generate 11.21 times more return on investment than HLS Therapeutics. However, Elixinol Global is 11.21 times more volatile than HLS Therapeutics. It trades about 0.27 of its potential returns per unit of risk. HLS Therapeutics is currently generating about 0.07 per unit of risk. If you would invest 1.00 in Elixinol Global on October 21, 2024 and sell it today you would earn a total of 1.13 from holding Elixinol Global or generate 113.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Elixinol Global vs. HLS Therapeutics
Performance |
| Timeline |
| Elixinol Global |
| HLS Therapeutics |
Elixinol Global and HLS Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elixinol Global and HLS Therapeutics
The main advantage of trading using opposite Elixinol Global and HLS Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elixinol Global position performs unexpectedly, HLS Therapeutics 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 HLS Therapeutics will offset losses from the drop in HLS Therapeutics' long position.| Elixinol Global vs. Pharmadrug | Elixinol Global vs. Livewire Ergogenics | Elixinol Global vs. Agra Ventures | Elixinol Global vs. BellRock Brands |
| HLS Therapeutics vs. Aion Therapeutic | HLS Therapeutics vs. Cannara Biotech | HLS Therapeutics vs. Knight Therapeutics | HLS Therapeutics vs. Canntab Therapeutics Limited |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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