Correlation Between Aurora Cannabis and Acer Therapeutics
Can any of the company-specific risk be diversified away by investing in both Aurora Cannabis and Acer Therapeutics 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 Aurora Cannabis and Acer Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aurora Cannabis and Acer Therapeutics, you can compare the effects of market volatilities on Aurora Cannabis and Acer Therapeutics 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 Aurora Cannabis with a short position of Acer Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aurora Cannabis and Acer Therapeutics.
Diversification Opportunities for Aurora Cannabis and Acer Therapeutics
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Aurora and Acer is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Aurora Cannabis and Acer Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acer Therapeutics and Aurora 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 Aurora Cannabis are associated (or correlated) with Acer Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acer Therapeutics has no effect on the direction of Aurora Cannabis i.e., Aurora Cannabis and Acer Therapeutics go up and down completely randomly.
Pair Corralation between Aurora Cannabis and Acer Therapeutics
If you would invest 331.00 in Aurora Cannabis on December 29, 2023 and sell it today you would earn a total of 108.00 from holding Aurora Cannabis or generate 32.63% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 4.35% |
Values | Daily Returns |
Aurora Cannabis vs. Acer Therapeutics
Performance |
Timeline |
Aurora Cannabis |
Acer Therapeutics |
Risk-Adjusted Performance
0 of 100
Low | High |
Very Weak
Aurora Cannabis and Acer Therapeutics Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Aurora Cannabis and Acer Therapeutics
The main advantage of trading using opposite Aurora Cannabis and Acer Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aurora Cannabis position performs unexpectedly, Acer Therapeutics 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 Acer Therapeutics will offset losses from the drop in Acer Therapeutics' long position.Aurora Cannabis vs. Madrigal Pharmaceuticals | Aurora Cannabis vs. 23Andme Holding Co | Aurora Cannabis vs. Moleculin Biotech | Aurora Cannabis vs. Equillium |
Acer Therapeutics vs. Precision Drilling | Acer Therapeutics vs. Forsys Metals Corp | Acer Therapeutics vs. Drilling Tools International | Acer Therapeutics vs. US GoldMining Common |
Check out your portfolio center.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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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