Correlation Between Johnson Johnson and Hexo Corp
Can any of the company-specific risk be diversified away by investing in both Johnson Johnson and Hexo Corp 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 Johnson Johnson and Hexo Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Johnson Johnson and Hexo Corp, you can compare the effects of market volatilities on Johnson Johnson and Hexo Corp 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 Johnson Johnson with a short position of Hexo Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Johnson Johnson and Hexo Corp.
Diversification Opportunities for Johnson Johnson and Hexo Corp
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Johnson and Hexo is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Johnson Johnson and Hexo Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hexo Corp and Johnson Johnson 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 Johnson Johnson are associated (or correlated) with Hexo Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hexo Corp has no effect on the direction of Johnson Johnson i.e., Johnson Johnson and Hexo Corp go up and down completely randomly.
Pair Corralation between Johnson Johnson and Hexo Corp
If you would invest 71.00 in Hexo Corp on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Hexo Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 2.38% |
| Values | Daily Returns |
Johnson Johnson vs. Hexo Corp
Performance |
| Timeline |
| Johnson Johnson |
| Hexo Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Johnson Johnson and Hexo Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Johnson Johnson and Hexo Corp
The main advantage of trading using opposite Johnson Johnson and Hexo Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Johnson Johnson position performs unexpectedly, Hexo Corp 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 Hexo Corp will offset losses from the drop in Hexo Corp's long position.| Johnson Johnson vs. Capricor Therapeutics | Johnson Johnson vs. Soleno Therapeutics | Johnson Johnson vs. Bio Path Holdings | Johnson Johnson vs. Moleculin Biotech |
| Hexo Corp vs. Aurora Cannabis | Hexo Corp vs. Canopy Growth Corp | Hexo Corp vs. Curaleaf Holdings | Hexo Corp vs. OrganiGram Holdings |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |