Correlation Between Greenlight Biosciences and Lexaria Bioscience

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

By analyzing existing cross correlation between Greenlight Biosciences Holdings and Lexaria Bioscience Corp, you can compare the effects of market volatilities on Greenlight Biosciences and Lexaria Bioscience 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 Greenlight Biosciences with a short position of Lexaria Bioscience. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greenlight Biosciences and Lexaria Bioscience.

Diversification Opportunities for Greenlight Biosciences and Lexaria Bioscience

0.0

Correlation Coefficient

Greenlight Biosciences  Lexaria Bioscience

Pay attention - limited upside

The 3 months correlation between Greenlight and Lexaria is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Greenlight Biosciences Holding and Lexaria Bioscience Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lexaria Bioscience Corp and Greenlight Biosciences 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 Greenlight Biosciences Holdings are associated (or correlated) with Lexaria Bioscience. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lexaria Bioscience Corp has no effect on the direction of Greenlight Biosciences i.e., Greenlight Biosciences and Lexaria Bioscience go up and down completely randomly.

Pair Corralation between Greenlight Biosciences and Lexaria Bioscience

If you would invest (100.00) in Greenlight Biosciences Holdings on December 30, 2024 and sell it today you would earn a total of  100.00  from holding Greenlight Biosciences Holdings or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Greenlight Biosciences Holding  vs.  Lexaria Bioscience Corp

Greenlight Biosciences

Risk-Adjusted Performance

Very Weak

Over the last 90 days Greenlight Biosciences Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Greenlight Biosciences is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Lexaria Bioscience Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Lexaria Bioscience Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Greenlight Biosciences and Lexaria Bioscience

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

The idea behind Greenlight Biosciences Holdings and Lexaria Bioscience 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.