Correlation Between CbdMD and Global Hemp
Can any of the company-specific risk be diversified away by investing in both CbdMD and Global Hemp 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 CbdMD and Global Hemp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between cbdMD Inc and Global Hemp Group, you can compare the effects of market volatilities on CbdMD and Global Hemp 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 CbdMD with a short position of Global Hemp. Check out your portfolio center. Please also check ongoing floating volatility patterns of CbdMD and Global Hemp.
Diversification Opportunities for CbdMD and Global Hemp
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between CbdMD and Global is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding cbdMD Inc and Global Hemp Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Hemp Group and CbdMD 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 cbdMD Inc are associated (or correlated) with Global Hemp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Hemp Group has no effect on the direction of CbdMD i.e., CbdMD and Global Hemp go up and down completely randomly.
Pair Corralation between CbdMD and Global Hemp
Given the investment horizon of 90 days cbdMD Inc is expected to generate 0.78 times more return on investment than Global Hemp. However, cbdMD Inc is 1.28 times less risky than Global Hemp. It trades about 0.08 of its potential returns per unit of risk. Global Hemp Group is currently generating about -0.25 per unit of risk. If you would invest 46.00 in cbdMD Inc on September 3, 2024 and sell it today you would earn a total of 3.00 from holding cbdMD Inc or generate 6.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
cbdMD Inc vs. Global Hemp Group
Performance |
| Timeline |
| cbdMD Inc |
| Global Hemp Group |
CbdMD and Global Hemp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CbdMD and Global Hemp
The main advantage of trading using opposite CbdMD and Global Hemp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CbdMD position performs unexpectedly, Global Hemp 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 Global Hemp will offset losses from the drop in Global Hemp's long position.| CbdMD vs. CV Sciences | CbdMD vs. Trulieve Cannabis Corp | CbdMD vs. Curaleaf Holdings | CbdMD vs. Green Thumb Industries |
| Global Hemp vs. Greater Cannabis | Global Hemp vs. Cannabis Suisse Corp | Global Hemp vs. Maple Leaf Green | Global Hemp vs. Mc Endvrs |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal |