Correlation Between Im Cannabis and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Im Cannabis and Dow Jones 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 Im Cannabis and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Im Cannabis Corp and Dow Jones Industrial, you can compare the effects of market volatilities on Im Cannabis and Dow Jones 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 Im Cannabis with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Im Cannabis and Dow Jones.
Diversification Opportunities for Im Cannabis and Dow Jones
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between IMCC and Dow is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Im Cannabis Corp and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial and Im Cannabis 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 Im Cannabis Corp are associated (or correlated) with Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of Im Cannabis i.e., Im Cannabis and Dow Jones go up and down completely randomly.
Pair Corralation between Im Cannabis and Dow Jones
Given the investment horizon of 90 days Im Cannabis Corp is expected to generate 13.06 times more return on investment than Dow Jones. However, Im Cannabis is 13.06 times more volatile than Dow Jones Industrial. It trades about 0.24 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.29 per unit of risk. If you would invest 216.00 in Im Cannabis Corp on August 31, 2024 and sell it today you would earn a total of 153.00 from holding Im Cannabis Corp or generate 70.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Im Cannabis Corp vs. Dow Jones Industrial
Performance |
| Timeline |
Im Cannabis and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Im Cannabis Corp
Pair trading matchups for Im Cannabis
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Im Cannabis and Dow Jones
The main advantage of trading using opposite Im Cannabis and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Im Cannabis position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.| Im Cannabis vs. Clever Leaves Holdings | Im Cannabis vs. Khiron Life Sciences | Im Cannabis vs. Allied Corp | Im Cannabis vs. Biofrontera |
| Dow Jones vs. Aerofoam Metals | Dow Jones vs. ACG Metals Limited | Dow Jones vs. China Clean Energy | Dow Jones vs. Fast Retailing Co |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |