Correlation Between Blockmate Ventures and Canopy Growth
Can any of the company-specific risk be diversified away by investing in both Blockmate Ventures and Canopy Growth 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 Blockmate Ventures and Canopy Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blockmate Ventures and Canopy Growth Corp, you can compare the effects of market volatilities on Blockmate Ventures and Canopy Growth 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 Blockmate Ventures with a short position of Canopy Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blockmate Ventures and Canopy Growth.
Diversification Opportunities for Blockmate Ventures and Canopy Growth
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Blockmate and Canopy is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Blockmate Ventures and Canopy Growth Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canopy Growth Corp and Blockmate Ventures 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 Blockmate Ventures are associated (or correlated) with Canopy Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canopy Growth Corp has no effect on the direction of Blockmate Ventures i.e., Blockmate Ventures and Canopy Growth go up and down completely randomly.
Pair Corralation between Blockmate Ventures and Canopy Growth
Assuming the 90 days trading horizon Blockmate Ventures is expected to generate 7.06 times more return on investment than Canopy Growth. However, Blockmate Ventures is 7.06 times more volatile than Canopy Growth Corp. It trades about 0.27 of its potential returns per unit of risk. Canopy Growth Corp is currently generating about -0.23 per unit of risk. If you would invest 4.50 in Blockmate Ventures on September 13, 2024 and sell it today you would earn a total of 6.50 from holding Blockmate Ventures or generate 144.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blockmate Ventures vs. Canopy Growth Corp
Performance |
| Timeline |
| Blockmate Ventures |
| Canopy Growth Corp |
Blockmate Ventures and Canopy Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blockmate Ventures and Canopy Growth
The main advantage of trading using opposite Blockmate Ventures and Canopy Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blockmate Ventures position performs unexpectedly, Canopy Growth 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 Canopy Growth will offset losses from the drop in Canopy Growth's long position.| Blockmate Ventures vs. Slate Grocery REIT | Blockmate Ventures vs. Morguard Real Estate | Blockmate Ventures vs. iShares Canadian HYBrid | Blockmate Ventures vs. Altagas Cum Red |
| Canopy Growth vs. Aurora Cannabis | Canopy Growth vs. Cronos Group | Canopy Growth vs. Air Canada | Canopy Growth vs. Shopify |
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 Correlations module to find global opportunities by holding instruments from different markets.
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