Correlation Between HUTCHMED DRC and Akanda Corp
Can any of the company-specific risk be diversified away by investing in both HUTCHMED DRC and Akanda Corp 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 HUTCHMED DRC and Akanda Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HUTCHMED DRC and Akanda Corp, you can compare the effects of market volatilities on HUTCHMED DRC and Akanda Corp 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 HUTCHMED DRC with a short position of Akanda Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUTCHMED DRC and Akanda Corp.
Diversification Opportunities for HUTCHMED DRC and Akanda Corp
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between HUTCHMED and Akanda is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding HUTCHMED DRC and Akanda Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akanda Corp and HUTCHMED DRC 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 HUTCHMED DRC are associated (or correlated) with Akanda Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akanda Corp has no effect on the direction of HUTCHMED DRC i.e., HUTCHMED DRC and Akanda Corp go up and down completely randomly.
Pair Corralation between HUTCHMED DRC and Akanda Corp
Considering the 90-day investment horizon HUTCHMED DRC is expected to generate 0.44 times more return on investment than Akanda Corp. However, HUTCHMED DRC is 2.25 times less risky than Akanda Corp. It trades about 0.04 of its potential returns per unit of risk. Akanda Corp is currently generating about -0.06 per unit of risk. If you would invest 1,179 in HUTCHMED DRC on September 2, 2024 and sell it today you would earn a total of 516.00 from holding HUTCHMED DRC or generate 43.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HUTCHMED DRC vs. Akanda Corp
Performance |
| Timeline |
| HUTCHMED DRC |
| Akanda Corp |
HUTCHMED DRC and Akanda Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUTCHMED DRC and Akanda Corp
The main advantage of trading using opposite HUTCHMED DRC and Akanda Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUTCHMED DRC position performs unexpectedly, Akanda Corp 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 Akanda Corp will offset losses from the drop in Akanda Corp's long position.| HUTCHMED DRC vs. ANI Pharmaceuticals | HUTCHMED DRC vs. Phibro Animal Health | HUTCHMED DRC vs. Prestige Brand Holdings | HUTCHMED DRC vs. Pacira BioSciences, |
| Akanda Corp vs. China SXT Pharmaceuticals | Akanda Corp vs. Petros Pharmaceuticals | Akanda Corp vs. GelStat Corp | Akanda Corp vs. Shuttle Pharmaceuticals |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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