Correlation Between North American and 1CM
Can any of the company-specific risk be diversified away by investing in both North American and 1CM 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 North American and 1CM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between North American Cannabis and 1CM Inc, you can compare the effects of market volatilities on North American and 1CM 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 North American with a short position of 1CM. Check out your portfolio center. Please also check ongoing floating volatility patterns of North American and 1CM.
Diversification Opportunities for North American and 1CM
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between North and 1CM is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding North American Cannabis and 1CM Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 1CM Inc and North American 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 North American Cannabis are associated (or correlated) with 1CM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 1CM Inc has no effect on the direction of North American i.e., North American and 1CM go up and down completely randomly.
Pair Corralation between North American and 1CM
Given the investment horizon of 90 days North American Cannabis is expected to generate 22.54 times more return on investment than 1CM. However, North American is 22.54 times more volatile than 1CM Inc. It trades about 0.22 of its potential returns per unit of risk. 1CM Inc is currently generating about -0.01 per unit of risk. If you would invest 0.00 in North American Cannabis on November 3, 2024 and sell it today you would earn a total of 0.00 from holding North American Cannabis or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 98.41% |
| Values | Daily Returns |
North American Cannabis vs. 1CM Inc
Performance |
| Timeline |
| North American Cannabis |
| 1CM Inc |
North American and 1CM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with North American and 1CM
The main advantage of trading using opposite North American and 1CM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if North American position performs unexpectedly, 1CM 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 1CM will offset losses from the drop in 1CM's long position.| North American vs. Cbd Life Sciences | North American vs. FutureWorld Corp | North American vs. Now Corp | North American vs. For The Earth |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios |