Correlation Between Ua Multimedia and Integrated Cannabis

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

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

Diversification Opportunities for Ua Multimedia and Integrated Cannabis

-0.24

Correlation Coefficient

Ua Multimedia  Integrated Cannabis

Very good diversification

The 3 months correlation between UAMM and Integrated is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Ua Multimedia and Integrated Cannabis Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Integrated Cannabis and Ua Multimedia 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 Ua Multimedia are associated (or correlated) with Integrated Cannabis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Integrated Cannabis has no effect on the direction of Ua Multimedia i.e., Ua Multimedia and Integrated Cannabis go up and down completely randomly.

Pair Corralation between Ua Multimedia and Integrated Cannabis

Given the investment horizon of 90 days Ua Multimedia is expected to generate 2.04 times more return on investment than Integrated Cannabis. However, Ua Multimedia is 2.04 times more volatile than Integrated Cannabis Solutions. It trades about 0.04 of its potential returns per unit of risk. Integrated Cannabis Solutions is currently generating about 0.04 per unit of risk. If you would invest  0.21  in Ua Multimedia on September 15, 2024 and sell it today you would lose (0.04) from holding Ua Multimedia or give up 19.05% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Ua Multimedia  vs.  Integrated Cannabis Solutions

Ua Multimedia

Risk-Adjusted Performance

5 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Ua Multimedia are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very conflicting primary indicators, Ua Multimedia displayed solid returns over the last few months and may actually be approaching a breakup point.

Integrated Cannabis

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Integrated Cannabis Solutions has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Pair Trading with Ua Multimedia and Integrated Cannabis

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

The idea behind Ua Multimedia and Integrated Cannabis Solutions 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.