Correlation Between INC Research and OrganiGram Holdings
Can any of the company-specific risk be diversified away by investing in both INC Research and OrganiGram Holdings 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 INC Research and OrganiGram Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INC Research Holdings and OrganiGram Holdings, you can compare the effects of market volatilities on INC Research and OrganiGram Holdings 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 INC Research with a short position of OrganiGram Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of INC Research and OrganiGram Holdings.
Diversification Opportunities for INC Research and OrganiGram Holdings
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between INC and OrganiGram is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding INC Research Holdings and OrganiGram Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OrganiGram Holdings and INC Research 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 INC Research Holdings are associated (or correlated) with OrganiGram Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OrganiGram Holdings has no effect on the direction of INC Research i.e., INC Research and OrganiGram Holdings go up and down completely randomly.
Pair Corralation between INC Research and OrganiGram Holdings
Given the investment horizon of 90 days INC Research Holdings is expected to under-perform the OrganiGram Holdings. In addition to that, INC Research is 1.22 times more volatile than OrganiGram Holdings. It trades about -0.11 of its total potential returns per unit of risk. OrganiGram Holdings is currently generating about 0.0 per unit of volatility. If you would invest 173.00 in OrganiGram Holdings on August 27, 2024 and sell it today you would lose (15.00) from holding OrganiGram Holdings or give up 8.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
INC Research Holdings vs. OrganiGram Holdings
Performance |
| Timeline |
| INC Research Holdings |
| OrganiGram Holdings |
INC Research and OrganiGram Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INC Research and OrganiGram Holdings
The main advantage of trading using opposite INC Research and OrganiGram Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INC Research position performs unexpectedly, OrganiGram Holdings 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 OrganiGram Holdings will offset losses from the drop in OrganiGram Holdings' long position.| INC Research vs. AYR Strategies Class | INC Research vs. Verano Holdings Corp | INC Research vs. TILT Holdings | INC Research vs. Lowell Farms |
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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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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