Correlation Between Monster Beverage and Griffin Mining
Can any of the company-specific risk be diversified away by investing in both Monster Beverage and Griffin Mining 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 Monster Beverage and Griffin Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Monster Beverage Corp and Griffin Mining, you can compare the effects of market volatilities on Monster Beverage and Griffin Mining 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 Monster Beverage with a short position of Griffin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Monster Beverage and Griffin Mining.
Diversification Opportunities for Monster Beverage and Griffin Mining
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Monster and Griffin is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Monster Beverage Corp and Griffin Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Griffin Mining and Monster Beverage 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 Monster Beverage Corp are associated (or correlated) with Griffin Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Griffin Mining has no effect on the direction of Monster Beverage i.e., Monster Beverage and Griffin Mining go up and down completely randomly.
Pair Corralation between Monster Beverage and Griffin Mining
Assuming the 90 days trading horizon Monster Beverage Corp is expected to generate 0.74 times more return on investment than Griffin Mining. However, Monster Beverage Corp is 1.35 times less risky than Griffin Mining. It trades about 0.03 of its potential returns per unit of risk. Griffin Mining is currently generating about 0.0 per unit of risk. If you would invest 5,232 in Monster Beverage Corp on September 3, 2024 and sell it today you would earn a total of 308.00 from holding Monster Beverage Corp or generate 5.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.22% |
| Values | Daily Returns |
Monster Beverage Corp vs. Griffin Mining
Performance |
| Timeline |
| Monster Beverage Corp |
| Griffin Mining |
Monster Beverage and Griffin Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Monster Beverage and Griffin Mining
The main advantage of trading using opposite Monster Beverage and Griffin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Monster Beverage position performs unexpectedly, Griffin Mining 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 Griffin Mining will offset losses from the drop in Griffin Mining's long position.| Monster Beverage vs. Catalyst Media Group | Monster Beverage vs. CATLIN GROUP | Monster Beverage vs. RTW Venture Fund | Monster Beverage vs. Secure Property Development |
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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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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