Correlation Between Trulieve Cannabis and Cannabis Suisse

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

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

Diversification Opportunities for Trulieve Cannabis and Cannabis Suisse

-0.4

Correlation Coefficient

Trulieve Cannabis  Cannabis Suisse

Very good diversification

The 3 months correlation between Trulieve and Cannabis is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Trulieve Cannabis Corp and Cannabis Suisse Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cannabis Suisse Corp and Trulieve 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 Trulieve Cannabis Corp are associated (or correlated) with Cannabis Suisse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cannabis Suisse Corp has no effect on the direction of Trulieve Cannabis i.e., Trulieve Cannabis and Cannabis Suisse go up and down completely randomly.

Pair Corralation between Trulieve Cannabis and Cannabis Suisse

Assuming the 90 days horizon Trulieve Cannabis Corp is expected to under-perform the Cannabis Suisse. But the otc stock apears to be less risky and, when comparing its historical volatility, Trulieve Cannabis Corp is 9.62 times less risky than Cannabis Suisse. The otc stock trades about -0.04 of its potential returns per unit of risk. The Cannabis Suisse Corp is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest  1.25  in Cannabis Suisse Corp on October 5, 2024 and sell it today you would earn a total of  0.95  from holding Cannabis Suisse Corp or generate 76.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.24%
Values	Daily Returns

Trulieve Cannabis Corp  vs.  Cannabis Suisse Corp

Trulieve Cannabis Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Trulieve Cannabis Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Cannabis Suisse Corp

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Cannabis Suisse Corp are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite fairly unfluctuating basic indicators, Cannabis Suisse demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Trulieve Cannabis and Cannabis Suisse

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

The idea behind Trulieve Cannabis Corp and Cannabis Suisse 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.

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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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.