Correlation Between Green Globe and Greenlane Holdings
Can any of the company-specific risk be diversified away by investing in both Green Globe and Greenlane 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 Green Globe and Greenlane Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Green Globe International and Greenlane Holdings, you can compare the effects of market volatilities on Green Globe and Greenlane 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 Green Globe with a short position of Greenlane Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Green Globe and Greenlane Holdings.
Diversification Opportunities for Green Globe and Greenlane Holdings
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Green and Greenlane is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Green Globe International and Greenlane Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greenlane Holdings and Green Globe 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 Green Globe International are associated (or correlated) with Greenlane Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greenlane Holdings has no effect on the direction of Green Globe i.e., Green Globe and Greenlane Holdings go up and down completely randomly.
Pair Corralation between Green Globe and Greenlane Holdings
Given the investment horizon of 90 days Green Globe International is expected to generate 4.96 times more return on investment than Greenlane Holdings. However, Green Globe is 4.96 times more volatile than Greenlane Holdings. It trades about 0.09 of its potential returns per unit of risk. Greenlane Holdings is currently generating about -0.58 per unit of risk. If you would invest 0.04 in Green Globe International on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Green Globe International or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Green Globe International vs. Greenlane Holdings
Performance |
| Timeline |
| Green Globe International |
| Greenlane Holdings |
Green Globe and Greenlane Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Green Globe and Greenlane Holdings
The main advantage of trading using opposite Green Globe and Greenlane Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Green Globe position performs unexpectedly, Greenlane 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 Greenlane Holdings will offset losses from the drop in Greenlane Holdings' long position.| Green Globe vs. Kaival Brands Innovations | Green Globe vs. Greenlane Holdings | Green Globe vs. RLX Technology | Green Globe vs. 22nd Century Group |
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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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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