Correlation Between Phibro Animal and Speakeasy Cannabis

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

By analyzing existing cross correlation between Phibro Animal Health and Speakeasy Cannabis Club, you can compare the effects of market volatilities on Phibro Animal and Speakeasy Cannabis 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 Phibro Animal with a short position of Speakeasy Cannabis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Phibro Animal and Speakeasy Cannabis.

Diversification Opportunities for Phibro Animal and Speakeasy Cannabis

0.0

Correlation Coefficient

Phibro Animal  Speakeasy Cannabis

Pay attention - limited upside

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

Pair Corralation between Phibro Animal and Speakeasy Cannabis

If you would invest  2,087  in Phibro Animal Health on December 30, 2024 and sell it today you would earn a total of  59.00  from holding Phibro Animal Health or generate 2.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.39%
Values	Daily Returns

Phibro Animal Health  vs.  Speakeasy Cannabis Club

Phibro Animal Health

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Phibro Animal Health are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical indicators, Phibro Animal is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Speakeasy Cannabis Club

Risk-Adjusted Performance

Very Weak

Over the last 90 days Speakeasy Cannabis Club has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental drivers, Speakeasy Cannabis is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Phibro Animal and Speakeasy Cannabis

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

The idea behind Phibro Animal Health and Speakeasy Cannabis Club 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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.