Correlation Between Northland Power and GRIFFIN MINING
Can any of the company-specific risk be diversified away by investing in both Northland Power 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 Northland Power and GRIFFIN MINING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Northland Power and GRIFFIN MINING LTD, you can compare the effects of market volatilities on Northland Power 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 Northland Power with a short position of GRIFFIN MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Northland Power and GRIFFIN MINING.
Diversification Opportunities for Northland Power and GRIFFIN MINING
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Northland and GRIFFIN is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Northland Power and GRIFFIN MINING LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GRIFFIN MINING LTD and Northland Power 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 Northland Power 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 LTD has no effect on the direction of Northland Power i.e., Northland Power and GRIFFIN MINING go up and down completely randomly.
Pair Corralation between Northland Power and GRIFFIN MINING
Assuming the 90 days horizon Northland Power is expected to under-perform the GRIFFIN MINING. In addition to that, Northland Power is 1.15 times more volatile than GRIFFIN MINING LTD. It trades about -0.04 of its total potential returns per unit of risk. GRIFFIN MINING LTD is currently generating about 0.06 per unit of volatility. If you would invest 150.00 in GRIFFIN MINING LTD on October 25, 2024 and sell it today you would earn a total of 22.00 from holding GRIFFIN MINING LTD or generate 14.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Northland Power vs. GRIFFIN MINING LTD
Performance |
| Timeline |
| Northland Power |
| GRIFFIN MINING LTD |
Northland Power and GRIFFIN MINING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Northland Power and GRIFFIN MINING
The main advantage of trading using opposite Northland Power and GRIFFIN MINING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Northland Power 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.| Northland Power vs. UPDATE SOFTWARE | Northland Power vs. X FAB Silicon Foundries | Northland Power vs. Shin Etsu Chemical Co | Northland Power vs. Cognizant Technology Solutions |
| GRIFFIN MINING vs. CN MODERN DAIRY | GRIFFIN MINING vs. MTY Food Group | GRIFFIN MINING vs. Reinsurance Group of | GRIFFIN MINING vs. Safety Insurance Group |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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