Correlation Between Greater Cannabis and Galexxy Holdings
Can any of the company-specific risk be diversified away by investing in both Greater Cannabis and Galexxy 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 Greater Cannabis and Galexxy Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Greater Cannabis and Galexxy Holdings, you can compare the effects of market volatilities on Greater Cannabis and Galexxy 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 Greater Cannabis with a short position of Galexxy Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greater Cannabis and Galexxy Holdings.
Diversification Opportunities for Greater Cannabis and Galexxy Holdings
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Greater and Galexxy is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Greater Cannabis and Galexxy Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Galexxy Holdings and Greater 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 Greater Cannabis are associated (or correlated) with Galexxy Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Galexxy Holdings has no effect on the direction of Greater Cannabis i.e., Greater Cannabis and Galexxy Holdings go up and down completely randomly.
Pair Corralation between Greater Cannabis and Galexxy Holdings
Given the investment horizon of 90 days Greater Cannabis is expected to generate 0.97 times more return on investment than Galexxy Holdings. However, Greater Cannabis is 1.04 times less risky than Galexxy Holdings. It trades about 0.06 of its potential returns per unit of risk. Galexxy Holdings is currently generating about -0.39 per unit of risk. If you would invest 0.04 in Greater Cannabis on September 12, 2024 and sell it today you would earn a total of 0.00 from holding Greater Cannabis or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 91.3% |
Values | Daily Returns |
Greater Cannabis vs. Galexxy Holdings
Performance |
Timeline |
Greater Cannabis |
Galexxy Holdings |
Greater Cannabis and Galexxy Holdings Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Greater Cannabis and Galexxy Holdings
The main advantage of trading using opposite Greater Cannabis and Galexxy Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Greater Cannabis position performs unexpectedly, Galexxy 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 Galexxy Holdings will offset losses from the drop in Galexxy Holdings' long position.Greater Cannabis vs. 4Front Ventures Corp | Greater Cannabis vs. Khiron Life Sciences | Greater Cannabis vs. BellRock Brands | Greater Cannabis vs. Elixinol Global |
Galexxy Holdings vs. 4Front Ventures Corp | Galexxy Holdings vs. Khiron Life Sciences | Galexxy Holdings vs. BellRock Brands | Galexxy Holdings vs. Elixinol Global |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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