Correlation Between Boat Rocker and OrganiGram Holdings

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

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

Diversification Opportunities for Boat Rocker and OrganiGram Holdings

0.65

Correlation Coefficient

Boat Rocker  OrganiGram Holdings

Poor diversification

The 3 months correlation between Boat and OrganiGram is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Boat Rocker Media and OrganiGram Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OrganiGram Holdings and Boat Rocker 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 Boat Rocker Media are associated (or correlated) with OrganiGram Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OrganiGram Holdings has no effect on the direction of Boat Rocker i.e., Boat Rocker and OrganiGram Holdings go up and down completely randomly.

Pair Corralation between Boat Rocker and OrganiGram Holdings

Assuming the 90 days trading horizon Boat Rocker Media is expected to under-perform the OrganiGram Holdings. In addition to that, Boat Rocker is 1.69 times more volatile than OrganiGram Holdings. It trades about -0.14 of its total potential returns per unit of risk. OrganiGram Holdings is currently generating about 0.04 per unit of volatility. If you would invest  234.00  in OrganiGram Holdings on October 7, 2024 and sell it today you would earn a total of  9.00  from holding OrganiGram Holdings or generate 3.85% return on investment over 90 days.

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

Boat Rocker Media  vs.  OrganiGram Holdings

Boat Rocker Media

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Boat Rocker Media has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

OrganiGram Holdings

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in OrganiGram Holdings are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating forward indicators, OrganiGram Holdings may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Boat Rocker and OrganiGram Holdings

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

The idea behind Boat Rocker Media and OrganiGram 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.