Correlation Between Humble Fume and 22nd Century
Can any of the company-specific risk be diversified away by investing in both Humble Fume and 22nd Century 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 Humble Fume and 22nd Century into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Humble Fume and 22nd Century Group, you can compare the effects of market volatilities on Humble Fume and 22nd Century 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 Humble Fume with a short position of 22nd Century. Check out your portfolio center. Please also check ongoing floating volatility patterns of Humble Fume and 22nd Century.
Diversification Opportunities for Humble Fume and 22nd Century
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Humble and 22nd is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Humble Fume and 22nd Century Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 22nd Century Group and Humble Fume 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 Humble Fume are associated (or correlated) with 22nd Century. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 22nd Century Group has no effect on the direction of Humble Fume i.e., Humble Fume and 22nd Century go up and down completely randomly.
Pair Corralation between Humble Fume and 22nd Century
If you would invest 11.00 in 22nd Century Group on August 28, 2024 and sell it today you would earn a total of 0.00 from holding 22nd Century Group or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Humble Fume vs. 22nd Century Group
Performance |
| Timeline |
| Humble Fume |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| 22nd Century Group |
Humble Fume and 22nd Century Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Humble Fume and 22nd Century
The main advantage of trading using opposite Humble Fume and 22nd Century positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Humble Fume position performs unexpectedly, 22nd Century 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 22nd Century will offset losses from the drop in 22nd Century's long position.| Humble Fume vs. PT Hanjaya Mandala | Humble Fume vs. Greenlane Holdings | Humble Fume vs. Pyxus International | Humble Fume vs. 22nd Century Group |
| 22nd Century vs. Turning Point Brands | 22nd Century vs. Green Globe International | 22nd Century vs. Imperial Brands PLC | 22nd Century vs. Kaival Brands Innovations |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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