Correlation Between Leef Brands and Marijuana
Can any of the company-specific risk be diversified away by investing in both Leef Brands and Marijuana 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 Marijuana into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Leef Brands and Marijuana, you can compare the effects of market volatilities on Leef Brands and Marijuana 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 Marijuana. Check out your portfolio center. Please also check ongoing floating volatility patterns of Leef Brands and Marijuana.
Diversification Opportunities for Leef Brands and Marijuana
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Leef and Marijuana is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Leef Brands and Marijuana in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marijuana 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 Marijuana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marijuana has no effect on the direction of Leef Brands i.e., Leef Brands and Marijuana go up and down completely randomly.
Pair Corralation between Leef Brands and Marijuana
Assuming the 90 days horizon Leef Brands is expected to generate 0.48 times more return on investment than Marijuana. However, Leef Brands is 2.09 times less risky than Marijuana. It trades about -0.01 of its potential returns per unit of risk. Marijuana is currently generating about -0.22 per unit of risk. If you would invest 17.00 in Leef Brands on September 1, 2024 and sell it today you would lose (2.00) from holding Leef Brands or give up 11.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Leef Brands vs. Marijuana
Performance |
| Timeline |
| Leef Brands |
| Marijuana |
Leef Brands and Marijuana Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Leef Brands and Marijuana
The main advantage of trading using opposite Leef Brands and Marijuana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Leef Brands position performs unexpectedly, Marijuana 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 Marijuana will offset losses from the drop in Marijuana's long position.| Leef Brands vs. Legacy Education | Leef Brands vs. Apple Inc | Leef Brands vs. NVIDIA | Leef Brands vs. Microsoft |
| Marijuana vs. Priority Aviation | Marijuana vs. Cbd Life Sciences | Marijuana vs. Hemp Inc | Marijuana vs. Emergent Health Corp |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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