Correlation Between First Trust and Cambria Cannabis
Can any of the company-specific risk be diversified away by investing in both First Trust and Cambria 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 First Trust and Cambria Cannabis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Trust Nasdaq and Cambria Cannabis ETF, you can compare the effects of market volatilities on First Trust and Cambria 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 First Trust with a short position of Cambria Cannabis. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Trust and Cambria Cannabis.
Diversification Opportunities for First Trust and Cambria Cannabis
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between First and Cambria is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding First Trust Nasdaq and Cambria Cannabis ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cambria Cannabis ETF and First Trust 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 First Trust Nasdaq are associated (or correlated) with Cambria Cannabis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cambria Cannabis ETF has no effect on the direction of First Trust i.e., First Trust and Cambria Cannabis go up and down completely randomly.
Pair Corralation between First Trust and Cambria Cannabis
Given the investment horizon of 90 days First Trust Nasdaq is expected to generate 0.29 times more return on investment than Cambria Cannabis. However, First Trust Nasdaq is 3.41 times less risky than Cambria Cannabis. It trades about -0.08 of its potential returns per unit of risk. Cambria Cannabis ETF is currently generating about -0.1 per unit of risk. If you would invest 2,238 in First Trust Nasdaq on August 27, 2025 and sell it today you would lose (96.00) from holding First Trust Nasdaq or give up 4.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Trust Nasdaq vs. Cambria Cannabis ETF
Performance |
| Timeline |
| First Trust Nasdaq |
| Cambria Cannabis ETF |
First Trust and Cambria Cannabis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Trust and Cambria Cannabis
The main advantage of trading using opposite First Trust and Cambria Cannabis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Trust position performs unexpectedly, Cambria 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 Cambria Cannabis will offset losses from the drop in Cambria Cannabis' long position.| First Trust vs. Ultimus Managers Trust | First Trust vs. American Beacon Select | First Trust vs. Direxion Daily SP | First Trust vs. EA Series Trust |
| Cambria Cannabis vs. Strategy Shares | Cambria Cannabis vs. Freedom Day Dividend | Cambria Cannabis vs. Franklin Templeton ETF | Cambria Cannabis vs. iShares MSCI China |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| AI Portfolio Prophet Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |