Correlation Between Leef Brands and Global Hemp
Can any of the company-specific risk be diversified away by investing in both Leef Brands and Global Hemp 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 Leef Brands and Global Hemp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Leef Brands and Global Hemp Group, you can compare the effects of market volatilities on Leef Brands and Global Hemp 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 Leef Brands with a short position of Global Hemp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Leef Brands and Global Hemp.
Diversification Opportunities for Leef Brands and Global Hemp
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Leef and Global is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Leef Brands and Global Hemp Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Hemp Group and Leef Brands 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 Leef Brands are associated (or correlated) with Global Hemp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Hemp Group has no effect on the direction of Leef Brands i.e., Leef Brands and Global Hemp go up and down completely randomly.
Pair Corralation between Leef Brands and Global Hemp
Assuming the 90 days horizon Leef Brands is expected to generate 8.41 times less return on investment than Global Hemp. But when comparing it to its historical volatility, Leef Brands is 2.79 times less risky than Global Hemp. It trades about 0.04 of its potential returns per unit of risk. Global Hemp Group is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 2.60 in Global Hemp Group on August 29, 2024 and sell it today you would lose (1.14) from holding Global Hemp Group or give up 43.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Leef Brands vs. Global Hemp Group
Performance |
| Timeline |
| Leef Brands |
| Global Hemp Group |
Leef Brands and Global Hemp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Leef Brands and Global Hemp
The main advantage of trading using opposite Leef Brands and Global Hemp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Leef Brands position performs unexpectedly, Global Hemp 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 Global Hemp will offset losses from the drop in Global Hemp's long position.| Leef Brands vs. Apple Inc | Leef Brands vs. Microsoft | Leef Brands vs. Alphabet Inc Class C | Leef Brands vs. Meta Platforms |
| Global Hemp vs. Greater Cannabis | Global Hemp vs. Cannabis Suisse Corp | Global Hemp vs. Maple Leaf Green | Global Hemp vs. Mc Endvrs |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Stocks Directory Find actively traded stocks across global markets | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. |