Correlation Between Lantheus Holdings and CannTrust Holdings

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Can any of the company-specific risk be diversified away by investing in both Lantheus Holdings and CannTrust 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 Lantheus Holdings and CannTrust Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lantheus Holdings and CannTrust Holdings, you can compare the effects of market volatilities on Lantheus Holdings and CannTrust 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 Lantheus Holdings with a short position of CannTrust Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lantheus Holdings and CannTrust Holdings.

Diversification Opportunities for Lantheus Holdings and CannTrust Holdings

LantheusCannTrustDiversified AwayLantheusCannTrustDiversified Away100%
-0.44
  Correlation Coefficient

Very good diversification

The 3 months correlation between Lantheus and CannTrust is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Lantheus Holdings and CannTrust Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CannTrust Holdings and Lantheus 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 Lantheus Holdings are associated (or correlated) with CannTrust Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CannTrust Holdings has no effect on the direction of Lantheus Holdings i.e., Lantheus Holdings and CannTrust Holdings go up and down completely randomly.

Pair Corralation between Lantheus Holdings and CannTrust Holdings

If you would invest  0.01  in CannTrust Holdings on September 23, 2024 and sell it today you would earn a total of  0.00  from holding CannTrust Holdings or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy1.54%
ValuesDaily Returns

Lantheus Holdings  vs.  CannTrust Holdings

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec -20020406080100
JavaScript chart by amCharts 3.21.15LNTH CNTTQ
       Timeline  
Lantheus Holdings 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Lantheus Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in January 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec7580859095100105110115
CannTrust Holdings 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days CannTrust Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, CannTrust Holdings is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Lantheus Holdings and CannTrust Holdings Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-5.87-4.39-2.92-1.45-0.0231.312.694.075.456.84 0.0050.0100.0150.0200.0250.030
JavaScript chart by amCharts 3.21.15LNTH CNTTQ
       Returns  

Pair Trading with Lantheus Holdings and CannTrust Holdings

The main advantage of trading using opposite Lantheus Holdings and CannTrust Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lantheus Holdings position performs unexpectedly, CannTrust 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 CannTrust Holdings will offset losses from the drop in CannTrust Holdings' long position.
The idea behind Lantheus Holdings and CannTrust Holdings pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.

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