Correlation Between CNH Industrial and Griffin Mining
Can any of the company-specific risk be diversified away by investing in both CNH Industrial 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 CNH Industrial and Griffin Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CNH Industrial NV and Griffin Mining, you can compare the effects of market volatilities on CNH Industrial 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 CNH Industrial with a short position of Griffin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of CNH Industrial and Griffin Mining.
Diversification Opportunities for CNH Industrial and Griffin Mining
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CNH and Griffin is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding CNH Industrial NV and Griffin Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Griffin Mining and CNH Industrial 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 CNH Industrial NV 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 CNH Industrial i.e., CNH Industrial and Griffin Mining go up and down completely randomly.
Pair Corralation between CNH Industrial and Griffin Mining
Assuming the 90 days trading horizon CNH Industrial NV is expected to under-perform the Griffin Mining. In addition to that, CNH Industrial is 1.45 times more volatile than Griffin Mining. It trades about -0.01 of its total potential returns per unit of risk. Griffin Mining is currently generating about 0.06 per unit of volatility. If you would invest 8,600 in Griffin Mining on October 14, 2024 and sell it today you would earn a total of 5,700 from holding Griffin Mining or generate 66.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 93.39% |
| Values | Daily Returns |
CNH Industrial NV vs. Griffin Mining
Performance |
| Timeline |
| CNH Industrial NV |
| Griffin Mining |
CNH Industrial and Griffin Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CNH Industrial and Griffin Mining
The main advantage of trading using opposite CNH Industrial and Griffin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CNH Industrial 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.| CNH Industrial vs. Host Hotels Resorts | CNH Industrial vs. InterContinental Hotels Group | CNH Industrial vs. Premier Foods PLC | CNH Industrial vs. Sparebank 1 SR |
| Griffin Mining vs. CNH Industrial NV | Griffin Mining vs. AMG Advanced Metallurgical | Griffin Mining vs. Jacquet Metal Service | Griffin Mining vs. Future Metals NL |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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