Correlation Between Micron Technology and Auxly Cannabis
Can any of the company-specific risk be diversified away by investing in both Micron Technology 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 Micron Technology and Auxly Cannabis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Micron Technology and Auxly Cannabis Group, you can compare the effects of market volatilities on Micron Technology 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 Micron Technology with a short position of Auxly Cannabis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Micron Technology and Auxly Cannabis.
Diversification Opportunities for Micron Technology and Auxly Cannabis
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Micron and Auxly is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Micron Technology 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 Micron Technology 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 Micron Technology 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 Micron Technology i.e., Micron Technology and Auxly Cannabis go up and down completely randomly.
Pair Corralation between Micron Technology and Auxly Cannabis
Allowing for the 90-day total investment horizon Micron Technology is expected to under-perform the Auxly Cannabis. But the stock apears to be less risky and, when comparing its historical volatility, Micron Technology is 19.31 times less risky than Auxly Cannabis. The stock trades about -0.07 of its potential returns per unit of risk. The Auxly Cannabis Group is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 2.54 in Auxly Cannabis Group on September 13, 2024 and sell it today you would lose (1.48) from holding Auxly Cannabis Group or give up 58.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Micron Technology vs. Auxly Cannabis Group
Performance |
| Timeline |
| Micron Technology |
| Auxly Cannabis Group |
Micron Technology and Auxly Cannabis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Micron Technology and Auxly Cannabis
The main advantage of trading using opposite Micron Technology and Auxly Cannabis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Micron Technology 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.| Micron Technology vs. NVIDIA | Micron Technology vs. Intel | Micron Technology vs. Taiwan Semiconductor Manufacturing | Micron Technology vs. Marvell Technology Group |
| Auxly Cannabis vs. PLAYMATES TOYS | Auxly Cannabis vs. FUTURE GAMING GRP | Auxly Cannabis vs. TITANIUM TRANSPORTGROUP | Auxly Cannabis vs. Fukuyama Transporting Co |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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