Correlation Between High Tide and 111

Can any of the company-specific risk be diversified away by investing in both High Tide and 111 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 High Tide and 111 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between High Tide and 111 Inc, you can compare the effects of market volatilities on High Tide and 111 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 High Tide with a short position of 111. Check out your portfolio center. Please also check ongoing floating volatility patterns of High Tide and 111.

Diversification Opportunities for High Tide and 111

-0.12

Correlation Coefficient

High Tide  111

Good diversification

The 3 months correlation between High and 111 is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding High Tide and 111 Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 111 Inc and High Tide 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 High Tide are associated (or correlated) with 111. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 111 Inc has no effect on the direction of High Tide i.e., High Tide and 111 go up and down completely randomly.

Pair Corralation between High Tide and 111

Given the investment horizon of 90 days High Tide is expected to under-perform the 111. But the stock apears to be less risky and, when comparing its historical volatility, High Tide is 1.85 times less risky than 111. The stock trades about -0.15 of its potential returns per unit of risk. The 111 Inc is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  792.00  in 111 Inc on December 1, 2024 and sell it today you would earn a total of  95.00  from holding 111 Inc or generate 11.99% return on investment over 90 days.

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

High Tide  vs.  111 Inc

High Tide

Risk-Adjusted Performance

Very Weak

Over the last 90 days High Tide has generated negative risk-adjusted returns adding no value to investors with long positions. Despite abnormal 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 recent confusion may also be a sign of long-lasting up-swing for the firm traders.

111 Inc

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in 111 Inc are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak forward indicators, 111 demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with High Tide and 111

The main advantage of trading using opposite High Tide and 111 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if High Tide position performs unexpectedly, 111 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 111 will offset losses from the drop in 111's long position.

The idea behind High Tide and 111 Inc 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.

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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.