Correlation Between Khiron Life and Cannabis Strategic
Can any of the company-specific risk be diversified away by investing in both Khiron Life and Cannabis Strategic 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 Khiron Life and Cannabis Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Khiron Life Sciences and Cannabis Strategic Ventures, you can compare the effects of market volatilities on Khiron Life and Cannabis Strategic 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 Khiron Life with a short position of Cannabis Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Khiron Life and Cannabis Strategic.
Diversification Opportunities for Khiron Life and Cannabis Strategic
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Khiron and Cannabis is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Khiron Life Sciences and Cannabis Strategic Ventures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cannabis Strategic and Khiron Life 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 Khiron Life Sciences are associated (or correlated) with Cannabis Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cannabis Strategic has no effect on the direction of Khiron Life i.e., Khiron Life and Cannabis Strategic go up and down completely randomly.
Pair Corralation between Khiron Life and Cannabis Strategic
Assuming the 90 days horizon Khiron Life is expected to generate 18.97 times less return on investment than Cannabis Strategic. But when comparing it to its historical volatility, Khiron Life Sciences is 4.24 times less risky than Cannabis Strategic. It trades about 0.06 of its potential returns per unit of risk. Cannabis Strategic Ventures is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 0.70 in Cannabis Strategic Ventures on September 13, 2024 and sell it today you would lose (0.69) from holding Cannabis Strategic Ventures or give up 98.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Khiron Life Sciences vs. Cannabis Strategic Ventures
Performance |
| Timeline |
| Khiron Life Sciences |
| Cannabis Strategic |
Khiron Life and Cannabis Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Khiron Life and Cannabis Strategic
The main advantage of trading using opposite Khiron Life and Cannabis Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Khiron Life position performs unexpectedly, Cannabis Strategic 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 Cannabis Strategic will offset losses from the drop in Cannabis Strategic's long position.| Khiron Life vs. Blueberries Medical Corp | Khiron Life vs. Speakeasy Cannabis Club | Khiron Life vs. City View Green | Khiron Life vs. Benchmark Botanics |
| Cannabis Strategic vs. 4Front Ventures Corp | Cannabis Strategic vs. Khiron Life Sciences | Cannabis Strategic vs. BellRock Brands | Cannabis Strategic vs. Elixinol Global |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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