Correlation Between 1CM and Green Hygienics

Can any of the company-specific risk be diversified away by investing in both 1CM and Green Hygienics 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 1CM and Green Hygienics into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between 1CM Inc and Green Hygienics Holdings, you can compare the effects of market volatilities on 1CM and Green Hygienics 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 1CM with a short position of Green Hygienics. Check out your portfolio center. Please also check ongoing floating volatility patterns of 1CM and Green Hygienics.

Diversification Opportunities for 1CM and Green Hygienics

0.0

Correlation Coefficient

1CM  Green Hygienics

Pay attention - limited upside

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

Pair Corralation between 1CM and Green Hygienics

If you would invest  19.00  in 1CM Inc on December 27, 2024 and sell it today you would earn a total of  2.00  from holding 1CM Inc or generate 10.53% return on investment over 90 days.

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

1CM Inc  vs.  Green Hygienics Holdings

1CM Inc

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in 1CM Inc are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly unfluctuating technical and fundamental indicators, 1CM reported solid returns over the last few months and may actually be approaching a breakup point.

Green Hygienics Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Green Hygienics Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Green Hygienics is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with 1CM and Green Hygienics

The main advantage of trading using opposite 1CM and Green Hygienics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 1CM position performs unexpectedly, Green Hygienics 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 Green Hygienics will offset losses from the drop in Green Hygienics' long position.

The idea behind 1CM Inc and Green Hygienics Holdings 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.