Correlation Between Lifeist Wellness and Auxly Cannabis
Can any of the company-specific risk be diversified away by investing in both Lifeist Wellness and Auxly Cannabis 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 Lifeist Wellness and Auxly Cannabis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lifeist Wellness and Auxly Cannabis Group, you can compare the effects of market volatilities on Lifeist Wellness and Auxly Cannabis 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 Lifeist Wellness with a short position of Auxly Cannabis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lifeist Wellness and Auxly Cannabis.
Diversification Opportunities for Lifeist Wellness and Auxly Cannabis
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lifeist and Auxly is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Lifeist Wellness and Auxly Cannabis Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Auxly Cannabis Group and Lifeist Wellness 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 Lifeist Wellness are associated (or correlated) with Auxly Cannabis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Auxly Cannabis Group has no effect on the direction of Lifeist Wellness i.e., Lifeist Wellness and Auxly Cannabis go up and down completely randomly.
Pair Corralation between Lifeist Wellness and Auxly Cannabis
Assuming the 90 days trading horizon Lifeist Wellness is expected to under-perform the Auxly Cannabis. But the stock apears to be less risky and, when comparing its historical volatility, Lifeist Wellness is 1.17 times less risky than Auxly Cannabis. The stock trades about -0.13 of its potential returns per unit of risk. The Auxly Cannabis Group is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 4.00 in Auxly Cannabis Group on August 26, 2024 and sell it today you would lose (0.50) from holding Auxly Cannabis Group or give up 12.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lifeist Wellness vs. Auxly Cannabis Group
Performance |
| Timeline |
| Lifeist Wellness |
| Auxly Cannabis Group |
Lifeist Wellness and Auxly Cannabis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lifeist Wellness and Auxly Cannabis
The main advantage of trading using opposite Lifeist Wellness and Auxly Cannabis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lifeist Wellness position performs unexpectedly, Auxly Cannabis 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 Auxly Cannabis will offset losses from the drop in Auxly Cannabis' long position.| Lifeist Wellness vs. Auxly Cannabis Group | Lifeist Wellness vs. Entourage Health Corp | Lifeist Wellness vs. Tilray Inc | Lifeist Wellness vs. Medipharm Labs Corp |
| Auxly Cannabis vs. OrganiGram Holdings | Auxly Cannabis vs. Tilray Inc | Auxly Cannabis vs. Lifeist Wellness | Auxly Cannabis vs. Medipharm Labs 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |