Correlation Between Im Cannabis and X4 Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Im Cannabis and X4 Pharmaceuticals 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 X4 Pharmaceuticals 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 X4 Pharmaceuticals, you can compare the effects of market volatilities on Im Cannabis and X4 Pharmaceuticals 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 X4 Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Im Cannabis and X4 Pharmaceuticals.
Diversification Opportunities for Im Cannabis and X4 Pharmaceuticals
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between IMCC and XFOR is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Im Cannabis Corp and X4 Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on X4 Pharmaceuticals 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 X4 Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of X4 Pharmaceuticals has no effect on the direction of Im Cannabis i.e., Im Cannabis and X4 Pharmaceuticals go up and down completely randomly.
Pair Corralation between Im Cannabis and X4 Pharmaceuticals
Given the investment horizon of 90 days Im Cannabis is expected to generate 1.95 times less return on investment than X4 Pharmaceuticals. In addition to that, Im Cannabis is 1.13 times more volatile than X4 Pharmaceuticals. It trades about 0.01 of its total potential returns per unit of risk. X4 Pharmaceuticals is currently generating about 0.02 per unit of volatility. If you would invest 104.00 in X4 Pharmaceuticals on October 25, 2024 and sell it today you would lose (55.00) from holding X4 Pharmaceuticals or give up 52.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Im Cannabis Corp vs. X4 Pharmaceuticals
Performance |
| Timeline |
| Im Cannabis Corp |
| X4 Pharmaceuticals |
Im Cannabis and X4 Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Im Cannabis and X4 Pharmaceuticals
The main advantage of trading using opposite Im Cannabis and X4 Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Im Cannabis position performs unexpectedly, X4 Pharmaceuticals 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 X4 Pharmaceuticals will offset losses from the drop in X4 Pharmaceuticals' long position.| Im Cannabis vs. Clever Leaves Holdings | Im Cannabis vs. Khiron Life Sciences | Im Cannabis vs. Allied Corp | Im Cannabis vs. Biofrontera |
| X4 Pharmaceuticals vs. Terns Pharmaceuticals | X4 Pharmaceuticals vs. Day One Biopharmaceuticals | X4 Pharmaceuticals vs. Hookipa Pharma | X4 Pharmaceuticals vs. Amylyx 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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