Correlation Between Greater Cannabis and HempAmericana
Can any of the company-specific risk be diversified away by investing in both Greater Cannabis and HempAmericana 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 HempAmericana into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Greater Cannabis and HempAmericana, you can compare the effects of market volatilities on Greater Cannabis and HempAmericana 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 HempAmericana. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greater Cannabis and HempAmericana.
Diversification Opportunities for Greater Cannabis and HempAmericana
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Greater and HempAmericana is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Greater Cannabis and HempAmericana in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HempAmericana 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 HempAmericana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HempAmericana has no effect on the direction of Greater Cannabis i.e., Greater Cannabis and HempAmericana go up and down completely randomly.
Pair Corralation between Greater Cannabis and HempAmericana
Given the investment horizon of 90 days Greater Cannabis is expected to generate 1.9 times more return on investment than HempAmericana. However, Greater Cannabis is 1.9 times more volatile than HempAmericana. It trades about 0.04 of its potential returns per unit of risk. HempAmericana is currently generating about -0.07 per unit of risk. If you would invest 0.08 in Greater Cannabis on August 29, 2024 and sell it today you would lose (0.04) from holding Greater Cannabis or give up 50.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Greater Cannabis vs. HempAmericana
Performance |
| Timeline |
| Greater Cannabis |
| HempAmericana |
Greater Cannabis and HempAmericana Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Greater Cannabis and HempAmericana
The main advantage of trading using opposite Greater Cannabis and HempAmericana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Greater Cannabis position performs unexpectedly, HempAmericana 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 HempAmericana will offset losses from the drop in HempAmericana'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 |
| HempAmericana vs. Real Brands | HempAmericana vs. Mc Endvrs | HempAmericana vs. One World Pharma | HempAmericana vs. Greater Cannabis |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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