Correlation Between Cronos and Radient Technologies

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

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

Diversification Opportunities for Cronos and Radient Technologies

0.33

Correlation Coefficient

Cronos  Radient Technologies

Weak diversification

The 3 months correlation between Cronos and Radient is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Cronos Group and Radient Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Radient Technologies and Cronos 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 Cronos Group are associated (or correlated) with Radient Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Radient Technologies has no effect on the direction of Cronos i.e., Cronos and Radient Technologies go up and down completely randomly.

Pair Corralation between Cronos and Radient Technologies

If you would invest  203.00  in Cronos Group on October 6, 2024 and sell it today you would earn a total of  4.00  from holding Cronos Group or generate 1.97% return on investment over 90 days.

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

Cronos Group  vs.  Radient Technologies

Cronos Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cronos Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Cronos is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Radient Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Radient Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Cronos and Radient Technologies

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

The idea behind Cronos Group and Radient Technologies 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..