Correlation Between Golden Developing and Integrated Cannabis

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

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

Diversification Opportunities for Golden Developing and Integrated Cannabis

-0.29

Correlation Coefficient

Golden Developing  Integrated Cannabis

Very good diversification

The 3 months correlation between Golden and Integrated is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Golden Developing Solutions and Integrated Cannabis Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Integrated Cannabis and Golden Developing 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 Golden Developing Solutions 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 Golden Developing i.e., Golden Developing and Integrated Cannabis go up and down completely randomly.

Pair Corralation between Golden Developing and Integrated Cannabis

Given the investment horizon of 90 days Golden Developing Solutions is expected to under-perform the Integrated Cannabis. In addition to that, Golden Developing is 1.56 times more volatile than Integrated Cannabis Solutions. It trades about -0.13 of its total potential returns per unit of risk. Integrated Cannabis Solutions is currently generating about 0.21 per unit of volatility. If you would invest  0.35  in Integrated Cannabis Solutions on December 1, 2024 and sell it today you would earn a total of  0.46  from holding Integrated Cannabis Solutions or generate 131.43% return on investment over 90 days.

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

Golden Developing Solutions  vs.  Integrated Cannabis Solutions

Golden Developing

Risk-Adjusted Performance

Very Weak

Over the last 90 days Golden Developing Solutions has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's essential indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Integrated Cannabis

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Integrated Cannabis Solutions are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite quite fragile basic indicators, Integrated Cannabis disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Golden Developing and Integrated Cannabis

The main advantage of trading using opposite Golden Developing and Integrated Cannabis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Golden Developing 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 Golden Developing Solutions 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.