Correlation Between Nexien Biopharma and Cann American
Can any of the company-specific risk be diversified away by investing in both Nexien Biopharma and Cann American 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 Nexien Biopharma and Cann American into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nexien Biopharma and Cann American Corp, you can compare the effects of market volatilities on Nexien Biopharma and Cann American 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 Nexien Biopharma with a short position of Cann American. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nexien Biopharma and Cann American.
Diversification Opportunities for Nexien Biopharma and Cann American
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Nexien and Cann is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Nexien Biopharma and Cann American Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cann American Corp and Nexien Biopharma 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 Nexien Biopharma are associated (or correlated) with Cann American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cann American Corp has no effect on the direction of Nexien Biopharma i.e., Nexien Biopharma and Cann American go up and down completely randomly.
Pair Corralation between Nexien Biopharma and Cann American
Given the investment horizon of 90 days Nexien Biopharma is expected to under-perform the Cann American. In addition to that, Nexien Biopharma is 1.56 times more volatile than Cann American Corp. It trades about -0.06 of its total potential returns per unit of risk. Cann American Corp is currently generating about -0.07 per unit of volatility. If you would invest 0.57 in Cann American Corp on September 4, 2024 and sell it today you would lose (0.27) from holding Cann American Corp or give up 47.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 90.91% |
| Values | Daily Returns |
Nexien Biopharma vs. Cann American Corp
Performance |
| Timeline |
| Nexien Biopharma |
| Cann American Corp |
Nexien Biopharma and Cann American Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nexien Biopharma and Cann American
The main advantage of trading using opposite Nexien Biopharma and Cann American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nexien Biopharma position performs unexpectedly, Cann American 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 Cann American will offset losses from the drop in Cann American's long position.| Nexien Biopharma vs. Cann American Corp | Nexien Biopharma vs. Speakeasy Cannabis Club | Nexien Biopharma vs. Benchmark Botanics | Nexien Biopharma vs. Link Reservations |
| Cann American vs. XCPCNL Business Services | Cann American vs. Golden Developing Solutions | Cann American vs. Indo Global Exchange | Cann American vs. Cgrowth Capital |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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