Correlation Between Verano Holdings and Acreage Holdings
Can any of the company-specific risk be diversified away by investing in both Verano Holdings 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 Verano Holdings and Acreage Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Verano Holdings Corp and Acreage Holdings, you can compare the effects of market volatilities on Verano Holdings 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 Verano Holdings with a short position of Acreage Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Verano Holdings and Acreage Holdings.
Diversification Opportunities for Verano Holdings and Acreage Holdings
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Verano and Acreage is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Verano Holdings Corp and Acreage Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acreage Holdings and Verano Holdings 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 Verano Holdings Corp 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 Verano Holdings i.e., Verano Holdings and Acreage Holdings go up and down completely randomly.
Pair Corralation between Verano Holdings and Acreage Holdings
Assuming the 90 days horizon Verano Holdings Corp is expected to under-perform the Acreage Holdings. But the otc stock apears to be less risky and, when comparing its historical volatility, Verano Holdings Corp is 1.71 times less risky than Acreage Holdings. The otc stock trades about -0.36 of its potential returns per unit of risk. The Acreage Holdings is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 18.00 in Acreage Holdings on August 28, 2024 and sell it today you would lose (5.00) from holding Acreage Holdings or give up 27.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Verano Holdings Corp vs. Acreage Holdings
Performance |
| Timeline |
| Verano Holdings Corp |
| Acreage Holdings |
Verano Holdings and Acreage Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Verano Holdings and Acreage Holdings
The main advantage of trading using opposite Verano Holdings and Acreage Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Verano Holdings 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.| Verano Holdings vs. Cresco Labs | Verano Holdings vs. AYR Strategies Class | Verano Holdings vs. Green Thumb Industries | Verano Holdings vs. Marimed |
| Acreage Holdings vs. AYR Strategies Class | Acreage Holdings vs. RIV Capital | Acreage Holdings vs. Verano Holdings Corp | Acreage Holdings vs. BZAM |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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