Correlation Between Greater Cannabis and Spectral Med
Can any of the company-specific risk be diversified away by investing in both Greater Cannabis and Spectral Med 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 Greater Cannabis and Spectral Med into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Greater Cannabis and Spectral Med, you can compare the effects of market volatilities on Greater Cannabis and Spectral Med 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 Greater Cannabis with a short position of Spectral Med. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greater Cannabis and Spectral Med.
Diversification Opportunities for Greater Cannabis and Spectral Med
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Greater and Spectral is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Greater Cannabis and Spectral Med in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spectral Med and Greater Cannabis 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 Greater Cannabis are associated (or correlated) with Spectral Med. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spectral Med has no effect on the direction of Greater Cannabis i.e., Greater Cannabis and Spectral Med go up and down completely randomly.
Pair Corralation between Greater Cannabis and Spectral Med
Given the investment horizon of 90 days Greater Cannabis is expected to generate 2.8 times more return on investment than Spectral Med. However, Greater Cannabis is 2.8 times more volatile than Spectral Med. It trades about 0.07 of its potential returns per unit of risk. Spectral Med is currently generating about 0.04 per unit of risk. If you would invest 0.05 in Greater Cannabis on October 7, 2024 and sell it today you would earn a total of 0.02 from holding Greater Cannabis or generate 40.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Greater Cannabis vs. Spectral Med
Performance |
| Timeline |
| Greater Cannabis |
| Spectral Med |
Greater Cannabis and Spectral Med Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Greater Cannabis and Spectral Med
The main advantage of trading using opposite Greater Cannabis and Spectral Med positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Greater Cannabis position performs unexpectedly, Spectral Med 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 Spectral Med will offset losses from the drop in Spectral Med's long position.| Greater Cannabis vs. Global Hemp Group | Greater Cannabis vs. Cannabis Suisse Corp | Greater Cannabis vs. Maple Leaf Green | Greater Cannabis vs. Mc Endvrs |
| Spectral Med vs. Avricore Health | Spectral Med vs. bioAffinity Technologies, | Spectral Med vs. BioMark Diagnostics | Spectral Med vs. Mainz Biomed BV |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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