Correlation Between Cannabis Suisse and CannaPharmaRx

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

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

Diversification Opportunities for Cannabis Suisse and CannaPharmaRx

-0.12

Correlation Coefficient

Cannabis Suisse  CannaPharmaRx

Good diversification

The 3 months correlation between Cannabis and CannaPharmaRx is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Cannabis Suisse Corp and CannaPharmaRx in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CannaPharmaRx and Cannabis Suisse 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 Cannabis Suisse Corp are associated (or correlated) with CannaPharmaRx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CannaPharmaRx has no effect on the direction of Cannabis Suisse i.e., Cannabis Suisse and CannaPharmaRx go up and down completely randomly.

Pair Corralation between Cannabis Suisse and CannaPharmaRx

Given the investment horizon of 90 days Cannabis Suisse Corp is expected to generate 2.08 times more return on investment than CannaPharmaRx. However, Cannabis Suisse is 2.08 times more volatile than CannaPharmaRx. It trades about 0.11 of its potential returns per unit of risk. CannaPharmaRx is currently generating about 0.0 per unit of risk. If you would invest  1.80  in Cannabis Suisse Corp on May 18, 2025 and sell it today you would lose (0.90) from holding Cannabis Suisse Corp or give up 50.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

Cannabis Suisse Corp  vs.  CannaPharmaRx

Cannabis Suisse Corp

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Cannabis Suisse Corp are ranked lower than 8 (%) 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.

CannaPharmaRx

Risk-Adjusted Performance

Weakest

Over the last 90 days CannaPharmaRx has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound primary indicators, CannaPharmaRx is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Cannabis Suisse and CannaPharmaRx

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

The idea behind Cannabis Suisse Corp and CannaPharmaRx 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.