Correlation Between Nutritional High and Leef Brands

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

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

Diversification Opportunities for Nutritional High and Leef Brands

0.0

Correlation Coefficient

Nutritional High  Leef Brands

Pay attention - limited upside

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

Pair Corralation between Nutritional High and Leef Brands

If you would invest  15.00  in Leef Brands on November 29, 2024 and sell it today you would earn a total of  3.00  from holding Leef Brands or generate 20.0% return on investment over 90 days.

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

Nutritional High International  vs.  Leef Brands

Nutritional High Int

Risk-Adjusted Performance

Very Weak

Over the last 90 days Nutritional High International has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable forward indicators, Nutritional High is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Leef Brands

Risk-Adjusted Performance

Modest

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

Pair Trading with Nutritional High and Leef Brands

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

The idea behind Nutritional High International and Leef Brands 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.