Correlation Between Green Cures and CanaQuest Medical

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

By analyzing existing cross correlation between Green Cures Botanical and CanaQuest Medical Corp, you can compare the effects of market volatilities on Green Cures and CanaQuest Medical 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 Cures with a short position of CanaQuest Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Green Cures and CanaQuest Medical.

Diversification Opportunities for Green Cures and CanaQuest Medical

-0.09

Correlation Coefficient

Green Cures  CanaQuest Medical

Good diversification

The 3 months correlation between Green and CanaQuest is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Green Cures Botanical and CanaQuest Medical Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CanaQuest Medical Corp and Green Cures 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 Cures Botanical are associated (or correlated) with CanaQuest Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CanaQuest Medical Corp has no effect on the direction of Green Cures i.e., Green Cures and CanaQuest Medical go up and down completely randomly.

Pair Corralation between Green Cures and CanaQuest Medical

Given the investment horizon of 90 days Green Cures Botanical is expected to generate 3.67 times more return on investment than CanaQuest Medical. However, Green Cures is 3.67 times more volatile than CanaQuest Medical Corp. It trades about 0.19 of its potential returns per unit of risk. CanaQuest Medical Corp is currently generating about 0.01 per unit of risk. If you would invest  0.02  in Green Cures Botanical on September 4, 2024 and sell it today you would lose (0.01) from holding Green Cures Botanical or give up 50.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Green Cures Botanical  vs.  CanaQuest Medical Corp

Green Cures Botanical

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Green Cures Botanical are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak fundamental indicators, Green Cures unveiled solid returns over the last few months and may actually be approaching a breakup point.

CanaQuest Medical Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CanaQuest Medical Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly weak basic indicators, CanaQuest Medical may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Green Cures and CanaQuest Medical

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

The idea behind Green Cures Botanical and CanaQuest Medical Corp 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.