Correlation Between Ipsen SA and Auxly Cannabis
Can any of the company-specific risk be diversified away by investing in both Ipsen SA and Auxly Cannabis 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 Ipsen SA and Auxly Cannabis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ipsen SA and Auxly Cannabis Group, you can compare the effects of market volatilities on Ipsen SA and Auxly Cannabis 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 Ipsen SA with a short position of Auxly Cannabis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ipsen SA and Auxly Cannabis.
Diversification Opportunities for Ipsen SA and Auxly Cannabis
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Ipsen and Auxly is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Ipsen SA and Auxly Cannabis Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Auxly Cannabis Group and Ipsen SA 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 Ipsen SA are associated (or correlated) with Auxly Cannabis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Auxly Cannabis Group has no effect on the direction of Ipsen SA i.e., Ipsen SA and Auxly Cannabis go up and down completely randomly.
Pair Corralation between Ipsen SA and Auxly Cannabis
Assuming the 90 days horizon Ipsen SA is expected to generate 19.3 times less return on investment than Auxly Cannabis. But when comparing it to its historical volatility, Ipsen SA is 37.2 times less risky than Auxly Cannabis. It trades about 0.45 of its potential returns per unit of risk. Auxly Cannabis Group is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 1.06 in Auxly Cannabis Group on October 25, 2024 and sell it today you would earn a total of 1.50 from holding Auxly Cannabis Group or generate 141.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ipsen SA vs. Auxly Cannabis Group
Performance |
| Timeline |
| Ipsen SA |
| Auxly Cannabis Group |
Ipsen SA and Auxly Cannabis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ipsen SA and Auxly Cannabis
The main advantage of trading using opposite Ipsen SA and Auxly Cannabis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ipsen SA position performs unexpectedly, Auxly Cannabis 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 Auxly Cannabis will offset losses from the drop in Auxly Cannabis' long position.| Ipsen SA vs. GRIFFIN MINING LTD | Ipsen SA vs. Ringmetall SE | Ipsen SA vs. DISTRICT METALS | Ipsen SA vs. OFFICE DEPOT |
| Auxly Cannabis vs. HOME DEPOT | Auxly Cannabis vs. OFFICE DEPOT | Auxly Cannabis vs. UNIVMUSIC GRPADR050 | Auxly Cannabis vs. KENEDIX OFFICE INV |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |