Correlation Between Baker Steel and Griffin Mining
Can any of the company-specific risk be diversified away by investing in both Baker Steel 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 Baker Steel and Griffin Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baker Steel Resources and Griffin Mining, you can compare the effects of market volatilities on Baker Steel 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 Baker Steel with a short position of Griffin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baker Steel and Griffin Mining.
Diversification Opportunities for Baker Steel and Griffin Mining
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Baker and Griffin is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Baker Steel Resources and Griffin Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Griffin Mining and Baker Steel 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 Baker Steel Resources 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 Baker Steel i.e., Baker Steel and Griffin Mining go up and down completely randomly.
Pair Corralation between Baker Steel and Griffin Mining
Assuming the 90 days trading horizon Baker Steel Resources is expected to under-perform the Griffin Mining. But the stock apears to be less risky and, when comparing its historical volatility, Baker Steel Resources is 1.5 times less risky than Griffin Mining. The stock trades about -0.01 of its potential returns per unit of risk. The Griffin Mining is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 14,200 in Griffin Mining on October 30, 2024 and sell it today you would earn a total of 100.00 from holding Griffin Mining or generate 0.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baker Steel Resources vs. Griffin Mining
Performance |
| Timeline |
| Baker Steel Resources |
| Griffin Mining |
Baker Steel and Griffin Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baker Steel and Griffin Mining
The main advantage of trading using opposite Baker Steel and Griffin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baker Steel 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.| Baker Steel vs. Batm Advanced Communications | Baker Steel vs. Gamma Communications PLC | Baker Steel vs. Target Healthcare REIT | Baker Steel vs. Eco Animal Health |
| Griffin Mining vs. MyHealthChecked Plc | Griffin Mining vs. Made Tech Group | Griffin Mining vs. Planet Fitness Cl | Griffin Mining vs. Eco Animal Health |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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