Correlation Between Viemed Healthcare and Canopy Growth
Can any of the company-specific risk be diversified away by investing in both Viemed Healthcare and Canopy Growth 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 Viemed Healthcare and Canopy Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Viemed Healthcare and Canopy Growth Corp, you can compare the effects of market volatilities on Viemed Healthcare and Canopy Growth 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 Viemed Healthcare with a short position of Canopy Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Viemed Healthcare and Canopy Growth.
Diversification Opportunities for Viemed Healthcare and Canopy Growth
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Viemed and Canopy is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Viemed Healthcare and Canopy Growth Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canopy Growth Corp and Viemed Healthcare 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 Viemed Healthcare are associated (or correlated) with Canopy Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canopy Growth Corp has no effect on the direction of Viemed Healthcare i.e., Viemed Healthcare and Canopy Growth go up and down completely randomly.
Pair Corralation between Viemed Healthcare and Canopy Growth
Considering the 90-day investment horizon Viemed Healthcare is expected to generate 0.48 times more return on investment than Canopy Growth. However, Viemed Healthcare is 2.08 times less risky than Canopy Growth. It trades about 0.07 of its potential returns per unit of risk. Canopy Growth Corp is currently generating about -0.09 per unit of risk. If you would invest 738.00 in Viemed Healthcare on September 2, 2024 and sell it today you would earn a total of 129.00 from holding Viemed Healthcare or generate 17.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Viemed Healthcare vs. Canopy Growth Corp
Performance |
| Timeline |
| Viemed Healthcare |
| Canopy Growth Corp |
Viemed Healthcare and Canopy Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Viemed Healthcare and Canopy Growth
The main advantage of trading using opposite Viemed Healthcare and Canopy Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Viemed Healthcare position performs unexpectedly, Canopy Growth 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 Canopy Growth will offset losses from the drop in Canopy Growth's long position.| Viemed Healthcare vs. Profound Medical Corp | Viemed Healthcare vs. Si Bone | Viemed Healthcare vs. Nevro Corp | Viemed Healthcare vs. Orthopediatrics Corp |
| Canopy Growth vs. Analog Devices | Canopy Growth vs. WiMi Hologram Cloud | Canopy Growth vs. WPP PLC ADR | Canopy Growth vs. Uber Technologies |
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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