Correlation Between Pure Extracts and Greater Cannabis
Can any of the company-specific risk be diversified away by investing in both Pure Extracts and Greater Cannabis 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 Pure Extracts and Greater Cannabis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pure Extracts Technologies and Greater Cannabis, you can compare the effects of market volatilities on Pure Extracts and Greater Cannabis 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 Pure Extracts with a short position of Greater Cannabis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pure Extracts and Greater Cannabis.
Diversification Opportunities for Pure Extracts and Greater Cannabis
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Pure and Greater is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Pure Extracts Technologies and Greater Cannabis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greater Cannabis and Pure Extracts 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 Pure Extracts Technologies are associated (or correlated) with Greater Cannabis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greater Cannabis has no effect on the direction of Pure Extracts i.e., Pure Extracts and Greater Cannabis go up and down completely randomly.
Pair Corralation between Pure Extracts and Greater Cannabis
Assuming the 90 days horizon Pure Extracts is expected to generate 1.82 times less return on investment than Greater Cannabis. In addition to that, Pure Extracts is 1.02 times more volatile than Greater Cannabis. It trades about 0.03 of its total potential returns per unit of risk. Greater Cannabis is currently generating about 0.06 per unit of volatility. If you would invest 0.05 in Greater Cannabis on September 7, 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 | Weak |
Accuracy | 27.25% |
Values | Daily Returns |
Pure Extracts Technologies vs. Greater Cannabis
Performance |
Timeline |
Pure Extracts Techno |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Greater Cannabis |
Pure Extracts and Greater Cannabis Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Pure Extracts and Greater Cannabis
The main advantage of trading using opposite Pure Extracts and Greater Cannabis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pure Extracts position performs unexpectedly, Greater Cannabis 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 Greater Cannabis will offset losses from the drop in Greater Cannabis' long position.Pure Extracts vs. Benchmark Botanics | Pure Extracts vs. Speakeasy Cannabis Club | Pure Extracts vs. City View Green | Pure Extracts vs. BC Craft Supply |
Greater Cannabis vs. Global Hemp Group | Greater Cannabis vs. Cannabis Suisse Corp | Greater Cannabis vs. Maple Leaf Green | Greater Cannabis 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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