Correlation Between Vermilion Energy and Aurora Cannabis
Can any of the company-specific risk be diversified away by investing in both Vermilion Energy and Aurora 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 Vermilion Energy and Aurora Cannabis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vermilion Energy and Aurora Cannabis, you can compare the effects of market volatilities on Vermilion Energy and Aurora 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 Vermilion Energy with a short position of Aurora Cannabis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vermilion Energy and Aurora Cannabis.
Diversification Opportunities for Vermilion Energy and Aurora Cannabis
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Vermilion and Aurora is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Vermilion Energy and Aurora Cannabis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurora Cannabis and Vermilion Energy 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 Vermilion Energy are associated (or correlated) with Aurora Cannabis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurora Cannabis has no effect on the direction of Vermilion Energy i.e., Vermilion Energy and Aurora Cannabis go up and down completely randomly.
Pair Corralation between Vermilion Energy and Aurora Cannabis
If you would invest 1,051 in Vermilion Energy on February 19, 2024 and sell it today you would earn a total of 182.00 from holding Vermilion Energy or generate 17.32% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
Vermilion Energy vs. Aurora Cannabis
Performance |
Timeline |
Vermilion Energy |
Aurora Cannabis |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Vermilion Energy and Aurora Cannabis Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Vermilion Energy and Aurora Cannabis
The main advantage of trading using opposite Vermilion Energy and Aurora Cannabis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vermilion Energy position performs unexpectedly, Aurora 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 Aurora Cannabis will offset losses from the drop in Aurora Cannabis' long position.Vermilion Energy vs. Baytex Energy Corp | Vermilion Energy vs. Obsidian Energy | Vermilion Energy vs. Canadian Natural Resources | Vermilion Energy vs. Ovintiv |
Aurora Cannabis vs. SkyWest | Aurora Cannabis vs. Mesa Air Group | Aurora Cannabis vs. Frontier Group Holdings | Aurora Cannabis vs. Commonwealth Bank of |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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