Correlation Between GraniteShares ETF and Innovator
Can any of the company-specific risk be diversified away by investing in both GraniteShares ETF and Innovator 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 Innovator 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 Innovator SP 500, you can compare the effects of market volatilities on GraniteShares ETF and Innovator 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 Innovator. Check out your portfolio center. Please also check ongoing floating volatility patterns of GraniteShares ETF and Innovator.
Diversification Opportunities for GraniteShares ETF and Innovator
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GraniteShares and Innovator is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding GraniteShares ETF Trust and Innovator SP 500 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Innovator SP 500 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 Innovator. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Innovator SP 500 has no effect on the direction of GraniteShares ETF i.e., GraniteShares ETF and Innovator go up and down completely randomly.
Pair Corralation between GraniteShares ETF and Innovator
Given the investment horizon of 90 days GraniteShares ETF Trust is expected to generate 51.63 times more return on investment than Innovator. However, GraniteShares ETF is 51.63 times more volatile than Innovator SP 500. It trades about 0.23 of its potential returns per unit of risk. Innovator SP 500 is currently generating about 0.14 per unit of risk. If you would invest 2,949 in GraniteShares ETF Trust on August 24, 2024 and sell it today you would earn a total of 2,457 from holding GraniteShares ETF Trust or generate 83.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GraniteShares ETF Trust vs. Innovator SP 500
Performance |
| Timeline |
| GraniteShares ETF Trust |
| Innovator SP 500 |
GraniteShares ETF and Innovator Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GraniteShares ETF and Innovator
The main advantage of trading using opposite GraniteShares ETF and Innovator positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GraniteShares ETF position performs unexpectedly, Innovator 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 Innovator will offset losses from the drop in Innovator'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 |
| Innovator vs. Innovator ETFs Trust | Innovator vs. First Trust Cboe | Innovator vs. FT Cboe Vest | Innovator vs. Innovator SP 500 |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |