Correlation Between Speakeasy Cannabis and StateHouse Holdings

Can any of the company-specific risk be diversified away by investing in both Speakeasy Cannabis and StateHouse 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 Speakeasy Cannabis and StateHouse Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Speakeasy Cannabis Club and StateHouse Holdings, you can compare the effects of market volatilities on Speakeasy Cannabis and StateHouse 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 Speakeasy Cannabis with a short position of StateHouse Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Speakeasy Cannabis and StateHouse Holdings.

Diversification Opportunities for Speakeasy Cannabis and StateHouse Holdings

0.0

Correlation Coefficient

Speakeasy Cannabis  StateHouse Holdings

Pay attention - limited upside

The 3 months correlation between Speakeasy and StateHouse is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Speakeasy Cannabis Club and StateHouse Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on StateHouse Holdings and Speakeasy 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 Speakeasy Cannabis Club are associated (or correlated) with StateHouse Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of StateHouse Holdings has no effect on the direction of Speakeasy Cannabis i.e., Speakeasy Cannabis and StateHouse Holdings go up and down completely randomly.

Pair Corralation between Speakeasy Cannabis and StateHouse Holdings

If you would invest  2.00  in StateHouse Holdings on September 17, 2024 and sell it today you would lose (0.50) from holding StateHouse Holdings or give up 25.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	96.92%
Values	Daily Returns

Speakeasy Cannabis Club  vs.  StateHouse Holdings

Speakeasy Cannabis Club

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Speakeasy Cannabis Club has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental drivers, Speakeasy Cannabis is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

StateHouse Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days StateHouse Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, StateHouse Holdings is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Speakeasy Cannabis and StateHouse Holdings

The main advantage of trading using opposite Speakeasy Cannabis and StateHouse Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Speakeasy Cannabis position performs unexpectedly, StateHouse 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 StateHouse Holdings will offset losses from the drop in StateHouse Holdings' long position.

The idea behind Speakeasy Cannabis Club and StateHouse 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.

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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.