Correlation Between Dream Residential and OrganiGram Holdings

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

By analyzing existing cross correlation between Dream Residential Real and OrganiGram Holdings, you can compare the effects of market volatilities on Dream Residential and OrganiGram Holdings 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 Dream Residential with a short position of OrganiGram Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dream Residential and OrganiGram Holdings.

Diversification Opportunities for Dream Residential and OrganiGram Holdings

0.75

Correlation Coefficient

Dream Residential  OrganiGram Holdings

Poor diversification

The 3 months correlation between Dream and OrganiGram is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Dream Residential Real and OrganiGram Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OrganiGram Holdings and Dream Residential 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 Dream Residential Real are associated (or correlated) with OrganiGram Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OrganiGram Holdings has no effect on the direction of Dream Residential i.e., Dream Residential and OrganiGram Holdings go up and down completely randomly.

Pair Corralation between Dream Residential and OrganiGram Holdings

Assuming the 90 days trading horizon Dream Residential is expected to generate 2.7 times less return on investment than OrganiGram Holdings. But when comparing it to its historical volatility, Dream Residential Real is 1.7 times less risky than OrganiGram Holdings. It trades about 0.11 of its potential returns per unit of risk. OrganiGram Holdings is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  159.00  in OrganiGram Holdings on April 24, 2025 and sell it today you would earn a total of  52.00  from holding OrganiGram Holdings or generate 32.7% return on investment over 90 days.

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

Dream Residential Real  vs.  OrganiGram Holdings

Dream Residential Real

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Dream Residential Real are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, Dream Residential may actually be approaching a critical reversion point that can send shares even higher in August 2025.

OrganiGram Holdings

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in OrganiGram Holdings are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of very abnormal forward indicators, OrganiGram Holdings displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Dream Residential and OrganiGram Holdings

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

The idea behind Dream Residential Real and OrganiGram Holdings 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.