Correlation Between 4Front Ventures and Galexxy Holdings
Can any of the company-specific risk be diversified away by investing in both 4Front Ventures and Galexxy Holdings 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 4Front Ventures and Galexxy Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 4Front Ventures Corp and Galexxy Holdings, you can compare the effects of market volatilities on 4Front Ventures and Galexxy Holdings 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 4Front Ventures with a short position of Galexxy Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of 4Front Ventures and Galexxy Holdings.
Diversification Opportunities for 4Front Ventures and Galexxy Holdings
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 4Front and Galexxy is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding 4Front Ventures Corp and Galexxy Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Galexxy Holdings and 4Front Ventures 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 4Front Ventures Corp are associated (or correlated) with Galexxy Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Galexxy Holdings has no effect on the direction of 4Front Ventures i.e., 4Front Ventures and Galexxy Holdings go up and down completely randomly.
Pair Corralation between 4Front Ventures and Galexxy Holdings
Assuming the 90 days horizon 4Front Ventures Corp is expected to under-perform the Galexxy Holdings. But the otc stock apears to be less risky and, when comparing its historical volatility, 4Front Ventures Corp is 1.19 times less risky than Galexxy Holdings. The otc stock trades about -0.02 of its potential returns per unit of risk. The Galexxy Holdings is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 6.10 in Galexxy Holdings on September 13, 2024 and sell it today you would lose (5.33) from holding Galexxy Holdings or give up 87.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.77% |
| Values | Daily Returns |
4Front Ventures Corp vs. Galexxy Holdings
Performance |
| Timeline |
| 4Front Ventures Corp |
| Galexxy Holdings |
4Front Ventures and Galexxy Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 4Front Ventures and Galexxy Holdings
The main advantage of trading using opposite 4Front Ventures and Galexxy Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 4Front Ventures position performs unexpectedly, Galexxy Holdings 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 Galexxy Holdings will offset losses from the drop in Galexxy Holdings' long position.| 4Front Ventures vs. Khiron Life Sciences | 4Front Ventures vs. BellRock Brands | 4Front Ventures vs. Elixinol Global |
| Galexxy Holdings vs. 4Front Ventures Corp | Galexxy Holdings vs. Khiron Life Sciences | Galexxy Holdings vs. BellRock Brands | Galexxy Holdings 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 CEOs Directory module to screen CEOs from public companies around the world.
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