Correlation Between Integrated Cannabis and GelStat Corp

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

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

Diversification Opportunities for Integrated Cannabis and GelStat Corp

0.0

Correlation Coefficient

Integrated Cannabis  GelStat Corp

Pay attention - limited upside

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

Pair Corralation between Integrated Cannabis and GelStat Corp

Given the investment horizon of 90 days Integrated Cannabis Solutions is expected to generate 1.01 times more return on investment than GelStat Corp. However, Integrated Cannabis is 1.01 times more volatile than GelStat Corp. It trades about 0.21 of its potential returns per unit of risk. GelStat Corp is currently generating about -0.02 per unit of risk. If you would invest  0.35  in Integrated Cannabis Solutions on November 29, 2024 and sell it today you would earn a total of  0.44  from holding Integrated Cannabis Solutions or generate 125.71% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	96.72%
Values	Daily Returns

Integrated Cannabis Solutions  vs.  GelStat Corp

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.

GelStat Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days GelStat Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest conflicting performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Integrated Cannabis and GelStat Corp

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

The idea behind Integrated Cannabis Solutions and GelStat 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.

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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.