Correlation Between Cannara Biotech and Acreage Holdings
Can any of the company-specific risk be diversified away by investing in both Cannara Biotech and Acreage Holdings 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 Cannara Biotech and Acreage Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cannara Biotech and Acreage Holdings, you can compare the effects of market volatilities on Cannara Biotech and Acreage Holdings 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 Cannara Biotech with a short position of Acreage Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cannara Biotech and Acreage Holdings.
Diversification Opportunities for Cannara Biotech and Acreage Holdings
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cannara and Acreage is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Cannara Biotech and Acreage Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acreage Holdings and Cannara Biotech 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 Cannara Biotech are associated (or correlated) with Acreage Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acreage Holdings has no effect on the direction of Cannara Biotech i.e., Cannara Biotech and Acreage Holdings go up and down completely randomly.
Pair Corralation between Cannara Biotech and Acreage Holdings
Assuming the 90 days horizon Cannara Biotech is expected to under-perform the Acreage Holdings. But the otc stock apears to be less risky and, when comparing its historical volatility, Cannara Biotech is 4.27 times less risky than Acreage Holdings. The otc stock trades about -0.19 of its potential returns per unit of risk. The Acreage Holdings is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 18.00 in Acreage Holdings on August 27, 2024 and sell it today you would lose (2.00) from holding Acreage Holdings or give up 11.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cannara Biotech vs. Acreage Holdings
Performance |
| Timeline |
| Cannara Biotech |
| Acreage Holdings |
Cannara Biotech and Acreage Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cannara Biotech and Acreage Holdings
The main advantage of trading using opposite Cannara Biotech and Acreage Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cannara Biotech position performs unexpectedly, Acreage Holdings 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 Acreage Holdings will offset losses from the drop in Acreage Holdings' long position.| Cannara Biotech vs. Benchmark Botanics | Cannara Biotech vs. Speakeasy Cannabis Club | Cannara Biotech vs. City View Green | Cannara Biotech vs. BC Craft Supply |
| Acreage Holdings vs. AYR Strategies Class | Acreage Holdings vs. RIV Capital | Acreage Holdings vs. Verano Holdings Corp | Acreage Holdings vs. BZAM |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years |