Correlation Between StateHouse Holdings and Unrivaled Brands

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

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

Diversification Opportunities for StateHouse Holdings and Unrivaled Brands

-0.09

Correlation Coefficient

StateHouse Holdings  Unrivaled Brands

Good diversification

The 3 months correlation between StateHouse and Unrivaled is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding StateHouse Holdings and Unrivaled Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unrivaled Brands and StateHouse 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 StateHouse Holdings are associated (or correlated) with Unrivaled Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unrivaled Brands has no effect on the direction of StateHouse Holdings i.e., StateHouse Holdings and Unrivaled Brands go up and down completely randomly.

Pair Corralation between StateHouse Holdings and Unrivaled Brands

If you would invest  2.00  in Unrivaled Brands on September 20, 2024 and sell it today you would earn a total of  0.00  from holding Unrivaled Brands or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.56%
Values	Daily Returns

StateHouse Holdings  vs.  Unrivaled Brands

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 fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Unrivaled Brands

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Unrivaled Brands has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Unrivaled Brands is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with StateHouse Holdings and Unrivaled Brands

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

The idea behind StateHouse Holdings and Unrivaled Brands 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.