Correlation Between AMG Advanced and Griffin Mining
Can any of the company-specific risk be diversified away by investing in both AMG Advanced 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 AMG Advanced and Griffin Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AMG Advanced Metallurgical and Griffin Mining, you can compare the effects of market volatilities on AMG Advanced 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 AMG Advanced with a short position of Griffin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMG Advanced and Griffin Mining.
Diversification Opportunities for AMG Advanced and Griffin Mining
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AMG and Griffin is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding AMG Advanced Metallurgical and Griffin Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Griffin Mining and AMG Advanced 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 AMG Advanced Metallurgical 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 AMG Advanced i.e., AMG Advanced and Griffin Mining go up and down completely randomly.
Pair Corralation between AMG Advanced and Griffin Mining
Assuming the 90 days trading horizon AMG Advanced Metallurgical is expected to under-perform the Griffin Mining. In addition to that, AMG Advanced is 1.24 times more volatile than Griffin Mining. It trades about -0.11 of its total potential returns per unit of risk. Griffin Mining is currently generating about 0.08 per unit of volatility. If you would invest 8,330 in Griffin Mining on September 2, 2024 and sell it today you would earn a total of 5,870 from holding Griffin Mining or generate 70.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AMG Advanced Metallurgical vs. Griffin Mining
Performance |
| Timeline |
| AMG Advanced Metallu |
| Griffin Mining |
AMG Advanced and Griffin Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AMG Advanced and Griffin Mining
The main advantage of trading using opposite AMG Advanced and Griffin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMG Advanced 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.| AMG Advanced vs. Uniper SE | AMG Advanced vs. Mulberry Group PLC | AMG Advanced vs. London Security Plc | AMG Advanced vs. Triad Group PLC |
| Griffin Mining vs. DXC Technology Co | Griffin Mining vs. Auction Technology Group | Griffin Mining vs. Zoom Video Communications | Griffin Mining vs. Spotify Technology SA |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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