Correlation Between Flora Growth and RIV Capital
Can any of the company-specific risk be diversified away by investing in both Flora Growth and RIV Capital 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 RIV Capital 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 RIV Capital, you can compare the effects of market volatilities on Flora Growth and RIV Capital 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 RIV Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flora Growth and RIV Capital.
Diversification Opportunities for Flora Growth and RIV Capital
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Flora and RIV is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Flora Growth Corp and RIV Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RIV Capital 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 RIV Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RIV Capital has no effect on the direction of Flora Growth i.e., Flora Growth and RIV Capital go up and down completely randomly.
Pair Corralation between Flora Growth and RIV Capital
Given the investment horizon of 90 days Flora Growth Corp is expected to under-perform the RIV Capital. In addition to that, Flora Growth is 1.06 times more volatile than RIV Capital. It trades about 0.0 of its total potential returns per unit of risk. RIV Capital is currently generating about 0.01 per unit of volatility. If you would invest 27.00 in RIV Capital on August 26, 2024 and sell it today you would lose (18.20) from holding RIV Capital or give up 67.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Flora Growth Corp vs. RIV Capital
Performance |
| Timeline |
| Flora Growth Corp |
| RIV Capital |
Flora Growth and RIV Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Flora Growth and RIV Capital
The main advantage of trading using opposite Flora Growth and RIV Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Flora Growth position performs unexpectedly, RIV Capital 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 RIV Capital will offset losses from the drop in RIV Capital's long position.| Flora Growth vs. Eliem Therapeutics | Flora Growth vs. HCW Biologics | Flora Growth vs. Scpharmaceuticals | Flora Growth vs. Milestone Pharmaceuticals |
| RIV Capital vs. Green Cures Botanical | RIV Capital vs. Galexxy Holdings | RIV Capital vs. Indoor Harvest Corp | RIV Capital vs. Speakeasy Cannabis Club |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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