Correlation Between Safe T and Cannabotech
Can any of the company-specific risk be diversified away by investing in both Safe T and Cannabotech 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 Safe T and Cannabotech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Safe T Group and Cannabotech, you can compare the effects of market volatilities on Safe T and Cannabotech 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 Safe T with a short position of Cannabotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Safe T and Cannabotech.
Diversification Opportunities for Safe T and Cannabotech
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Safe and Cannabotech is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Safe T Group and Cannabotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cannabotech and Safe T 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 Safe T Group are associated (or correlated) with Cannabotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cannabotech has no effect on the direction of Safe T i.e., Safe T and Cannabotech go up and down completely randomly.
Pair Corralation between Safe T and Cannabotech
Assuming the 90 days trading horizon Safe T Group is expected to generate 0.63 times more return on investment than Cannabotech. However, Safe T Group is 1.59 times less risky than Cannabotech. It trades about 0.02 of its potential returns per unit of risk. Cannabotech is currently generating about -0.03 per unit of risk. If you would invest 48,700 in Safe T Group on November 3, 2024 and sell it today you would lose (12,860) from holding Safe T Group or give up 26.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Safe T Group vs. Cannabotech
Performance |
| Timeline |
| Safe T Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Cannabotech |
Safe T and Cannabotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Safe T and Cannabotech
The main advantage of trading using opposite Safe T and Cannabotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Safe T position performs unexpectedly, Cannabotech 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 Cannabotech will offset losses from the drop in Cannabotech's long position.| Safe T vs. Polyram Plastic Industries | Safe T vs. Golan Plastic | Safe T vs. RSL Electronics | Safe T vs. Retailors |
| Cannabotech vs. YD More Investments | Cannabotech vs. Millennium Food Tech LP | Cannabotech vs. Batm Advanced Communications | Cannabotech vs. Arad Investment Industrial |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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