Correlation Between WIMFARM SA and Granite Construction
Can any of the company-specific risk be diversified away by investing in both WIMFARM SA and Granite Construction 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 WIMFARM SA and Granite Construction into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WIMFARM SA EO and Granite Construction, you can compare the effects of market volatilities on WIMFARM SA and Granite Construction 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 WIMFARM SA with a short position of Granite Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of WIMFARM SA and Granite Construction.
Diversification Opportunities for WIMFARM SA and Granite Construction
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between WIMFARM and Granite is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding WIMFARM SA EO and Granite Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Granite Construction and WIMFARM SA 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 WIMFARM SA EO are associated (or correlated) with Granite Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Granite Construction has no effect on the direction of WIMFARM SA i.e., WIMFARM SA and Granite Construction go up and down completely randomly.
Pair Corralation between WIMFARM SA and Granite Construction
Assuming the 90 days horizon WIMFARM SA EO is expected to generate 3.99 times more return on investment than Granite Construction. However, WIMFARM SA is 3.99 times more volatile than Granite Construction. It trades about 0.1 of its potential returns per unit of risk. Granite Construction is currently generating about -0.11 per unit of risk. If you would invest 322.00 in WIMFARM SA EO on October 26, 2024 and sell it today you would earn a total of 54.00 from holding WIMFARM SA EO or generate 16.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
WIMFARM SA EO vs. Granite Construction
Performance |
| Timeline |
| WIMFARM SA EO |
| Granite Construction |
WIMFARM SA and Granite Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WIMFARM SA and Granite Construction
The main advantage of trading using opposite WIMFARM SA and Granite Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WIMFARM SA position performs unexpectedly, Granite Construction 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 Granite Construction will offset losses from the drop in Granite Construction's long position.| WIMFARM SA vs. Air Transport Services | WIMFARM SA vs. EVS Broadcast Equipment | WIMFARM SA vs. Datadog | WIMFARM SA vs. DATADOT TECHNOLOGY |
| Granite Construction vs. Virtus Investment Partners | Granite Construction vs. CHRYSALIS INVESTMENTS LTD | Granite Construction vs. CDL INVESTMENT | Granite Construction vs. IMAGIN MEDICAL INC |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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