Correlation Between Slang Worldwide and Acreage Holdings
Can any of the company-specific risk be diversified away by investing in both Slang Worldwide and Acreage Holdings 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 Slang Worldwide and Acreage Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Slang Worldwide and Acreage Holdings, you can compare the effects of market volatilities on Slang Worldwide and Acreage Holdings 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 Slang Worldwide with a short position of Acreage Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Slang Worldwide and Acreage Holdings.
Diversification Opportunities for Slang Worldwide and Acreage Holdings
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Slang and Acreage is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Slang Worldwide and Acreage Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acreage Holdings and Slang Worldwide 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 Slang Worldwide are associated (or correlated) with Acreage Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acreage Holdings has no effect on the direction of Slang Worldwide i.e., Slang Worldwide and Acreage Holdings go up and down completely randomly.
Pair Corralation between Slang Worldwide and Acreage Holdings
Assuming the 90 days horizon Slang Worldwide is expected to generate 2.16 times more return on investment than Acreage Holdings. However, Slang Worldwide is 2.16 times more volatile than Acreage Holdings. It trades about 0.04 of its potential returns per unit of risk. Acreage Holdings is currently generating about -0.09 per unit of risk. If you would invest 2.30 in Slang Worldwide on September 5, 2024 and sell it today you would lose (1.99) from holding Slang Worldwide or give up 86.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.41% |
| Values | Daily Returns |
Slang Worldwide vs. Acreage Holdings
Performance |
| Timeline |
| Slang Worldwide |
| Acreage Holdings |
Slang Worldwide and Acreage Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Slang Worldwide and Acreage Holdings
The main advantage of trading using opposite Slang Worldwide and Acreage Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Slang Worldwide position performs unexpectedly, Acreage Holdings 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 Acreage Holdings will offset losses from the drop in Acreage Holdings' long position.| Slang Worldwide vs. Cann American Corp | Slang Worldwide vs. Speakeasy Cannabis Club | Slang Worldwide vs. Benchmark Botanics | Slang Worldwide vs. Link Reservations |
| Acreage Holdings vs. Verano Holdings Corp | Acreage Holdings vs. Ascend Wellness Holdings | Acreage Holdings vs. Green Thumb Industries | Acreage Holdings vs. Slang Worldwide |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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