Correlation Between Elixinol Global and 1CM
Can any of the company-specific risk be diversified away by investing in both Elixinol Global and 1CM 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 1CM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elixinol Global and 1CM Inc, you can compare the effects of market volatilities on Elixinol Global and 1CM 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 1CM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elixinol Global and 1CM.
Diversification Opportunities for Elixinol Global and 1CM
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Elixinol and 1CM is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Elixinol Global and 1CM Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 1CM Inc 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 1CM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 1CM Inc has no effect on the direction of Elixinol Global i.e., Elixinol Global and 1CM go up and down completely randomly.
Pair Corralation between Elixinol Global and 1CM
Assuming the 90 days horizon Elixinol Global is expected to generate 14.45 times more return on investment than 1CM. However, Elixinol Global is 14.45 times more volatile than 1CM Inc. It trades about 0.11 of its potential returns per unit of risk. 1CM Inc is currently generating about -0.04 per unit of risk. If you would invest 1.40 in Elixinol Global on September 13, 2024 and sell it today you would lose (0.90) from holding Elixinol Global or give up 64.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Elixinol Global vs. 1CM Inc
Performance |
| Timeline |
| Elixinol Global |
| 1CM Inc |
Elixinol Global and 1CM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elixinol Global and 1CM
The main advantage of trading using opposite Elixinol Global and 1CM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elixinol Global position performs unexpectedly, 1CM 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 1CM will offset losses from the drop in 1CM's long position.| Elixinol Global vs. Pharmadrug | Elixinol Global vs. Livewire Ergogenics | Elixinol Global vs. Agra Ventures | Elixinol Global vs. BellRock Brands |
| 1CM vs. 4Front Ventures Corp | 1CM vs. Khiron Life Sciences | 1CM vs. BellRock Brands | 1CM 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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