Correlation Between OrganiGram Holdings and Bausch Health

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

By analyzing existing cross correlation between OrganiGram Holdings and Bausch Health Companies, you can compare the effects of market volatilities on OrganiGram Holdings and Bausch Health 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 OrganiGram Holdings with a short position of Bausch Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of OrganiGram Holdings and Bausch Health.

Diversification Opportunities for OrganiGram Holdings and Bausch Health

0.43

Correlation Coefficient

OrganiGram Holdings  Bausch Health

Very weak diversification

The 3 months correlation between OrganiGram and Bausch is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding OrganiGram Holdings and Bausch Health Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bausch Health Companies and OrganiGram Holdings 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 OrganiGram Holdings are associated (or correlated) with Bausch Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bausch Health Companies has no effect on the direction of OrganiGram Holdings i.e., OrganiGram Holdings and Bausch Health go up and down completely randomly.

Pair Corralation between OrganiGram Holdings and Bausch Health

Considering the 90-day investment horizon OrganiGram Holdings is expected to under-perform the Bausch Health. In addition to that, OrganiGram Holdings is 1.32 times more volatile than Bausch Health Companies. It trades about -0.16 of its total potential returns per unit of risk. Bausch Health Companies is currently generating about -0.09 per unit of volatility. If you would invest  773.00  in Bausch Health Companies on December 29, 2024 and sell it today you would lose (125.00) from holding Bausch Health Companies or give up 16.17% of portfolio value over 90 days.

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

OrganiGram Holdings  vs.  Bausch Health Companies

OrganiGram Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days OrganiGram Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's technical and fundamental 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.

Bausch Health Companies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bausch Health Companies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's technical indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with OrganiGram Holdings and Bausch Health

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

The idea behind OrganiGram Holdings and Bausch Health Companies 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.