Correlation Between Green Cures and Body
Can any of the company-specific risk be diversified away by investing in both Green Cures and Body 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 Cures and Body into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Green Cures Botanical and Body and Mind, you can compare the effects of market volatilities on Green Cures and Body 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 Cures with a short position of Body. Check out your portfolio center. Please also check ongoing floating volatility patterns of Green Cures and Body.
Diversification Opportunities for Green Cures and Body
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Green and Body is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Green Cures Botanical and Body and Mind in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Body and Mind and Green Cures 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 Cures Botanical are associated (or correlated) with Body. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Body and Mind has no effect on the direction of Green Cures i.e., Green Cures and Body go up and down completely randomly.
Pair Corralation between Green Cures and Body
Given the investment horizon of 90 days Green Cures Botanical is expected to generate 4.9 times more return on investment than Body. However, Green Cures is 4.9 times more volatile than Body and Mind. It trades about 0.21 of its potential returns per unit of risk. Body and Mind is currently generating about -0.26 per unit of risk. If you would invest 0.01 in Green Cures Botanical on August 30, 2024 and sell it today you would earn a total of 0.00 from holding Green Cures Botanical or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Green Cures Botanical vs. Body and Mind
Performance |
| Timeline |
| Green Cures Botanical |
| Body and Mind |
Green Cures and Body Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Green Cures and Body
The main advantage of trading using opposite Green Cures and Body positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Green Cures position performs unexpectedly, Body 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 Body will offset losses from the drop in Body's long position.| Green Cures vs. Cann American Corp | Green Cures vs. Rimrock Gold Corp | Green Cures vs. Galexxy Holdings | Green Cures vs. Indoor Harvest Corp |
| Body vs. Goodness Growth Holdings | Body vs. 4Front Ventures Corp | Body vs. Rubicon Organics | Body vs. CLS Holdings USA |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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