Correlation Between Pure Harvest and Clever Leaves
Can any of the company-specific risk be diversified away by investing in both Pure Harvest and Clever Leaves 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 Pure Harvest and Clever Leaves into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pure Harvest Cannabis and Clever Leaves Holdings, you can compare the effects of market volatilities on Pure Harvest and Clever Leaves 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 Pure Harvest with a short position of Clever Leaves. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pure Harvest and Clever Leaves.
Diversification Opportunities for Pure Harvest and Clever Leaves
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Pure and Clever is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Pure Harvest Cannabis and Clever Leaves Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clever Leaves Holdings and Pure Harvest 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 Pure Harvest Cannabis are associated (or correlated) with Clever Leaves. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clever Leaves Holdings has no effect on the direction of Pure Harvest i.e., Pure Harvest and Clever Leaves go up and down completely randomly.
Pair Corralation between Pure Harvest and Clever Leaves
Given the investment horizon of 90 days Pure Harvest Cannabis is expected to generate 1.32 times more return on investment than Clever Leaves. However, Pure Harvest is 1.32 times more volatile than Clever Leaves Holdings. It trades about 0.08 of its potential returns per unit of risk. Clever Leaves Holdings is currently generating about 0.06 per unit of risk. If you would invest 1.70 in Pure Harvest Cannabis on August 25, 2024 and sell it today you would lose (1.57) from holding Pure Harvest Cannabis or give up 92.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 31.79% |
| Values | Daily Returns |
Pure Harvest Cannabis vs. Clever Leaves Holdings
Performance |
| Timeline |
| Pure Harvest Cannabis |
| Clever Leaves Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Pure Harvest and Clever Leaves Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pure Harvest and Clever Leaves
The main advantage of trading using opposite Pure Harvest and Clever Leaves positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pure Harvest position performs unexpectedly, Clever Leaves 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 Clever Leaves will offset losses from the drop in Clever Leaves' long position.| Pure Harvest vs. Benchmark Botanics | Pure Harvest vs. Speakeasy Cannabis Club | Pure Harvest vs. City View Green | Pure Harvest vs. BC Craft Supply |
| Clever Leaves vs. Clever Leaves Holdings | Clever Leaves vs. CannBioRx Life Sciences | Clever Leaves vs. Clene Inc | Clever Leaves vs. CuriosityStream |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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