Correlation Between Auxly Cannabis and RBC Discount
Can any of the company-specific risk be diversified away by investing in both Auxly Cannabis and RBC Discount 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 Auxly Cannabis and RBC Discount into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Auxly Cannabis Group and RBC Discount Bond, you can compare the effects of market volatilities on Auxly Cannabis and RBC Discount 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 Auxly Cannabis with a short position of RBC Discount. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auxly Cannabis and RBC Discount.
Diversification Opportunities for Auxly Cannabis and RBC Discount
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Auxly and RBC is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Auxly Cannabis Group and RBC Discount Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RBC Discount Bond and Auxly Cannabis 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 Auxly Cannabis Group are associated (or correlated) with RBC Discount. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RBC Discount Bond has no effect on the direction of Auxly Cannabis i.e., Auxly Cannabis and RBC Discount go up and down completely randomly.
Pair Corralation between Auxly Cannabis and RBC Discount
Assuming the 90 days trading horizon Auxly Cannabis Group is expected to generate 20.41 times more return on investment than RBC Discount. However, Auxly Cannabis is 20.41 times more volatile than RBC Discount Bond. It trades about 0.01 of its potential returns per unit of risk. RBC Discount Bond is currently generating about 0.05 per unit of risk. If you would invest 4.00 in Auxly Cannabis Group on August 30, 2024 and sell it today you would lose (0.25) from holding Auxly Cannabis Group or give up 6.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Auxly Cannabis Group vs. RBC Discount Bond
Performance |
| Timeline |
| Auxly Cannabis Group |
| RBC Discount Bond |
Auxly Cannabis and RBC Discount Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Auxly Cannabis and RBC Discount
The main advantage of trading using opposite Auxly Cannabis and RBC Discount positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auxly Cannabis position performs unexpectedly, RBC Discount 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 RBC Discount will offset losses from the drop in RBC Discount's long position.| Auxly Cannabis vs. OrganiGram Holdings | Auxly Cannabis vs. Tilray Inc | Auxly Cannabis vs. Lifeist Wellness | Auxly Cannabis vs. Medipharm Labs Corp |
| RBC Discount vs. RBC Target 2029 | RBC Discount vs. RBC Quant Dividend | RBC Discount vs. RBC Quant EAFE | RBC Discount vs. RBC Quant European |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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