Correlation Between US Lithium and Incannex Healthcare
Can any of the company-specific risk be diversified away by investing in both US Lithium and Incannex Healthcare 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 US Lithium and Incannex Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between US Lithium Corp and Incannex Healthcare Ltd, you can compare the effects of market volatilities on US Lithium and Incannex Healthcare 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 US Lithium with a short position of Incannex Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of US Lithium and Incannex Healthcare.
Diversification Opportunities for US Lithium and Incannex Healthcare
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between LITH and Incannex is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding US Lithium Corp and Incannex Healthcare Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Incannex Healthcare and US Lithium 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 US Lithium Corp are associated (or correlated) with Incannex Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Incannex Healthcare has no effect on the direction of US Lithium i.e., US Lithium and Incannex Healthcare go up and down completely randomly.
Pair Corralation between US Lithium and Incannex Healthcare
If you would invest 180.00 in Incannex Healthcare Ltd on October 26, 2024 and sell it today you would lose (5.00) from holding Incannex Healthcare Ltd or give up 2.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
US Lithium Corp vs. Incannex Healthcare Ltd
Performance |
| Timeline |
| US Lithium Corp |
| Incannex Healthcare |
US Lithium and Incannex Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with US Lithium and Incannex Healthcare
The main advantage of trading using opposite US Lithium and Incannex Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if US Lithium position performs unexpectedly, Incannex Healthcare 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 Incannex Healthcare will offset losses from the drop in Incannex Healthcare's long position.| US Lithium vs. Mc Endvrs | US Lithium vs. Kali Inc | US Lithium vs. One World Pharma | US Lithium vs. HempAmericana |
| Incannex Healthcare vs. Delta 9 Cannabis | Incannex Healthcare vs. City View Green | Incannex Healthcare vs. Benchmark Botanics | Incannex Healthcare vs. Speakeasy Cannabis Club |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device |