Correlation Between GraniteShares ETF and American Century
Can any of the company-specific risk be diversified away by investing in both GraniteShares ETF and American Century 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 GraniteShares ETF and American Century into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GraniteShares ETF Trust and American Century Short, you can compare the effects of market volatilities on GraniteShares ETF and American Century 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 GraniteShares ETF with a short position of American Century. Check out your portfolio center. Please also check ongoing floating volatility patterns of GraniteShares ETF and American Century.
Diversification Opportunities for GraniteShares ETF and American Century
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GraniteShares and American is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding GraniteShares ETF Trust and American Century Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Century Short and GraniteShares ETF 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 GraniteShares ETF Trust are associated (or correlated) with American Century. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Century Short has no effect on the direction of GraniteShares ETF i.e., GraniteShares ETF and American Century go up and down completely randomly.
Pair Corralation between GraniteShares ETF and American Century
Given the investment horizon of 90 days GraniteShares ETF Trust is expected to generate 174.36 times more return on investment than American Century. However, GraniteShares ETF is 174.36 times more volatile than American Century Short. It trades about 0.3 of its potential returns per unit of risk. American Century Short is currently generating about 0.15 per unit of risk. If you would invest 2,282 in GraniteShares ETF Trust on September 1, 2024 and sell it today you would earn a total of 3,056 from holding GraniteShares ETF Trust or generate 133.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
GraniteShares ETF Trust vs. American Century Short
Performance |
| Timeline |
| GraniteShares ETF Trust |
| American Century Short |
GraniteShares ETF and American Century Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GraniteShares ETF and American Century
The main advantage of trading using opposite GraniteShares ETF and American Century positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GraniteShares ETF position performs unexpectedly, American Century 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 American Century will offset losses from the drop in American Century's long position.| GraniteShares ETF vs. GraniteShares ETF Trust | GraniteShares ETF vs. Direxion Shares ETF | GraniteShares ETF vs. Direxion Daily AMZN | GraniteShares ETF vs. Direxion Daily GOOGL |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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