Correlation Between Lowell Farms and Greenrose Acquisition
Can any of the company-specific risk be diversified away by investing in both Lowell Farms and Greenrose Acquisition 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 Lowell Farms and Greenrose Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lowell Farms and Greenrose Acquisition Corp, you can compare the effects of market volatilities on Lowell Farms and Greenrose Acquisition 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 Lowell Farms with a short position of Greenrose Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lowell Farms and Greenrose Acquisition.
Diversification Opportunities for Lowell Farms and Greenrose Acquisition
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lowell and Greenrose is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Lowell Farms and Greenrose Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greenrose Acquisition and Lowell Farms 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 Lowell Farms are associated (or correlated) with Greenrose Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greenrose Acquisition has no effect on the direction of Lowell Farms i.e., Lowell Farms and Greenrose Acquisition go up and down completely randomly.
Pair Corralation between Lowell Farms and Greenrose Acquisition
If you would invest 1.90 in Lowell Farms on September 4, 2024 and sell it today you would lose (0.10) from holding Lowell Farms or give up 5.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 5.0% |
| Values | Daily Returns |
Lowell Farms vs. Greenrose Acquisition Corp
Performance |
| Timeline |
| Lowell Farms |
| Greenrose Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Lowell Farms and Greenrose Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lowell Farms and Greenrose Acquisition
The main advantage of trading using opposite Lowell Farms and Greenrose Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lowell Farms position performs unexpectedly, Greenrose Acquisition 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 Greenrose Acquisition will offset losses from the drop in Greenrose Acquisition's long position.| Lowell Farms vs. Medicine Man Technologies | Lowell Farms vs. Ascend Wellness Holdings | Lowell Farms vs. Goodness Growth Holdings | Lowell Farms vs. AYR Strategies Class |
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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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