Correlation Between Entourage Health and City View
Can any of the company-specific risk be diversified away by investing in both Entourage Health and City View 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 Entourage Health and City View into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Entourage Health Corp and City View Green, you can compare the effects of market volatilities on Entourage Health and City View 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 Entourage Health with a short position of City View. Check out your portfolio center. Please also check ongoing floating volatility patterns of Entourage Health and City View.
Diversification Opportunities for Entourage Health and City View
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Entourage and City is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Entourage Health Corp and City View Green in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on City View Green and Entourage Health 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 Entourage Health Corp are associated (or correlated) with City View. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of City View Green has no effect on the direction of Entourage Health i.e., Entourage Health and City View go up and down completely randomly.
Pair Corralation between Entourage Health and City View
Assuming the 90 days horizon Entourage Health is expected to generate 1.37 times less return on investment than City View. In addition to that, Entourage Health is 1.07 times more volatile than City View Green. It trades about 0.06 of its total potential returns per unit of risk. City View Green is currently generating about 0.09 per unit of volatility. If you would invest 0.13 in City View Green on November 5, 2024 and sell it today you would earn a total of 0.43 from holding City View Green or generate 330.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.2% |
| Values | Daily Returns |
Entourage Health Corp vs. City View Green
Performance |
| Timeline |
| Entourage Health Corp |
| City View Green |
Entourage Health and City View Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Entourage Health and City View
The main advantage of trading using opposite Entourage Health and City View positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Entourage Health position performs unexpectedly, City View 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 City View will offset losses from the drop in City View's long position.| Entourage Health vs. Benchmark Botanics | Entourage Health vs. Speakeasy Cannabis Club | Entourage Health vs. City View Green | Entourage Health vs. BC Craft Supply |
| City View vs. Benchmark Botanics | City View vs. Speakeasy Cannabis Club | City View vs. BC Craft Supply | City View 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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