Correlation Between Flora Growth and AgriFORCE Growing
Can any of the company-specific risk be diversified away by investing in both Flora Growth and AgriFORCE Growing 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 Flora Growth and AgriFORCE Growing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Flora Growth Corp and AgriFORCE Growing Systems, you can compare the effects of market volatilities on Flora Growth and AgriFORCE Growing 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 Flora Growth with a short position of AgriFORCE Growing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flora Growth and AgriFORCE Growing.
Diversification Opportunities for Flora Growth and AgriFORCE Growing
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Flora and AgriFORCE is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Flora Growth Corp and AgriFORCE Growing Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AgriFORCE Growing Systems and Flora Growth 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 Flora Growth Corp are associated (or correlated) with AgriFORCE Growing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AgriFORCE Growing Systems has no effect on the direction of Flora Growth i.e., Flora Growth and AgriFORCE Growing go up and down completely randomly.
Pair Corralation between Flora Growth and AgriFORCE Growing
Given the investment horizon of 90 days Flora Growth Corp is expected to generate 0.98 times more return on investment than AgriFORCE Growing. However, Flora Growth Corp is 1.02 times less risky than AgriFORCE Growing. It trades about 0.01 of its potential returns per unit of risk. AgriFORCE Growing Systems is currently generating about -0.13 per unit of risk. If you would invest 510.00 in Flora Growth Corp on August 28, 2024 and sell it today you would lose (359.00) from holding Flora Growth Corp or give up 70.39% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Flora Growth Corp vs. AgriFORCE Growing Systems
Performance |
| Timeline |
| Flora Growth Corp |
| AgriFORCE Growing Systems |
Flora Growth and AgriFORCE Growing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Flora Growth and AgriFORCE Growing
The main advantage of trading using opposite Flora Growth and AgriFORCE Growing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Flora Growth position performs unexpectedly, AgriFORCE Growing 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 AgriFORCE Growing will offset losses from the drop in AgriFORCE Growing's long position.| Flora Growth vs. Eliem Therapeutics | Flora Growth vs. Scpharmaceuticals | Flora Growth vs. Milestone Pharmaceuticals | Flora Growth vs. Seres Therapeutics |
| AgriFORCE Growing vs. Limoneira Co | AgriFORCE Growing vs. Forafric Global PLC | AgriFORCE Growing vs. Australian Agricultural | AgriFORCE Growing vs. NaturalShrimp |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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