Correlation Between TerrAscend Corp and Cardiol Therapeutics

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

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

Diversification Opportunities for TerrAscend Corp and Cardiol Therapeutics

-0.71

Correlation Coefficient

TerrAscend Corp  Cardiol Therapeutics

Pay attention - limited upside

The 3 months correlation between TerrAscend and Cardiol is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding TerrAscend Corp and Cardiol Therapeutics Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cardiol Therapeutics and TerrAscend Corp 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 TerrAscend Corp are associated (or correlated) with Cardiol Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cardiol Therapeutics has no effect on the direction of TerrAscend Corp i.e., TerrAscend Corp and Cardiol Therapeutics go up and down completely randomly.

Pair Corralation between TerrAscend Corp and Cardiol Therapeutics

Assuming the 90 days trading horizon TerrAscend Corp is expected to under-perform the Cardiol Therapeutics. In addition to that, TerrAscend Corp is 4.37 times more volatile than Cardiol Therapeutics Class. It trades about -0.11 of its total potential returns per unit of risk. Cardiol Therapeutics Class is currently generating about -0.01 per unit of volatility. If you would invest  152.00  in Cardiol Therapeutics Class on July 1, 2025 and sell it today you would lose (1.00) from holding Cardiol Therapeutics Class or give up 0.66% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

TerrAscend Corp  vs.  Cardiol Therapeutics Class

TerrAscend Corp

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in TerrAscend Corp are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, TerrAscend Corp displayed solid returns over the last few months and may actually be approaching a breakup point.

Cardiol Therapeutics

Risk-Adjusted Performance

Weakest

Over the last 90 days Cardiol Therapeutics Class has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in October 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with TerrAscend Corp and Cardiol Therapeutics

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

The idea behind TerrAscend Corp and Cardiol Therapeutics Class 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.