Correlation Between Rubicon Organics and C21 Investments
Can any of the company-specific risk be diversified away by investing in both Rubicon Organics and C21 Investments 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 Rubicon Organics and C21 Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rubicon Organics and C21 Investments, you can compare the effects of market volatilities on Rubicon Organics and C21 Investments 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 Rubicon Organics with a short position of C21 Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rubicon Organics and C21 Investments.
Diversification Opportunities for Rubicon Organics and C21 Investments
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Rubicon and C21 is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Rubicon Organics and C21 Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on C21 Investments and Rubicon Organics 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 Rubicon Organics are associated (or correlated) with C21 Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of C21 Investments has no effect on the direction of Rubicon Organics i.e., Rubicon Organics and C21 Investments go up and down completely randomly.
Pair Corralation between Rubicon Organics and C21 Investments
Assuming the 90 days horizon Rubicon Organics is expected to generate 0.73 times more return on investment than C21 Investments. However, Rubicon Organics is 1.37 times less risky than C21 Investments. It trades about -0.06 of its potential returns per unit of risk. C21 Investments is currently generating about -0.04 per unit of risk. If you would invest 27.00 in Rubicon Organics on August 28, 2024 and sell it today you would lose (3.00) from holding Rubicon Organics or give up 11.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rubicon Organics vs. C21 Investments
Performance |
| Timeline |
| Rubicon Organics |
| C21 Investments |
Rubicon Organics and C21 Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rubicon Organics and C21 Investments
The main advantage of trading using opposite Rubicon Organics and C21 Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rubicon Organics position performs unexpectedly, C21 Investments 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 C21 Investments will offset losses from the drop in C21 Investments' long position.| Rubicon Organics vs. Benchmark Botanics | Rubicon Organics vs. Speakeasy Cannabis Club | Rubicon Organics vs. City View Green | Rubicon Organics vs. BC Craft Supply |
| C21 Investments vs. Delta 9 Cannabis | C21 Investments vs. Halo Collective | C21 Investments vs. Willow Biosciences | C21 Investments vs. Entourage Health Corp |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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