Correlation Between Green Growth and HempAmericana
Can any of the company-specific risk be diversified away by investing in both Green Growth and HempAmericana 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 Green Growth and HempAmericana into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Green Growth Brands and HempAmericana, you can compare the effects of market volatilities on Green Growth and HempAmericana 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 Green Growth with a short position of HempAmericana. Check out your portfolio center. Please also check ongoing floating volatility patterns of Green Growth and HempAmericana.
Diversification Opportunities for Green Growth and HempAmericana
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Green and HempAmericana is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Green Growth Brands and HempAmericana in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HempAmericana and Green Growth 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 Green Growth Brands are associated (or correlated) with HempAmericana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HempAmericana has no effect on the direction of Green Growth i.e., Green Growth and HempAmericana go up and down completely randomly.
Pair Corralation between Green Growth and HempAmericana
Assuming the 90 days horizon Green Growth is expected to generate 1.06 times less return on investment than HempAmericana. In addition to that, Green Growth is 1.0 times more volatile than HempAmericana. It trades about 0.05 of its total potential returns per unit of risk. HempAmericana is currently generating about 0.05 per unit of volatility. If you would invest 0.01 in HempAmericana on October 8, 2024 and sell it today you would earn a total of 0.00 from holding HempAmericana or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 99.65% |
Values | Daily Returns |
Green Growth Brands vs. HempAmericana
Performance |
Timeline |
Green Growth Brands |
HempAmericana |
Green Growth and HempAmericana Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Green Growth and HempAmericana
The main advantage of trading using opposite Green Growth and HempAmericana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Green Growth position performs unexpectedly, HempAmericana 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 HempAmericana will offset losses from the drop in HempAmericana's long position.Green Growth vs. Delta 9 Cannabis | Green Growth vs. Willow Biosciences | Green Growth vs. CordovaCann Corp | Green Growth vs. Decibel Cannabis |
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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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