Correlation Between CryptoStar Corp and Granite Construction
Can any of the company-specific risk be diversified away by investing in both CryptoStar Corp 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 CryptoStar Corp and Granite Construction into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CryptoStar Corp and Granite Construction Incorporated, you can compare the effects of market volatilities on CryptoStar Corp 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 CryptoStar Corp with a short position of Granite Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of CryptoStar Corp and Granite Construction.
Diversification Opportunities for CryptoStar Corp and Granite Construction
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CryptoStar and Granite is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding CryptoStar Corp and Granite Construction Incorpora in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Granite Construction and CryptoStar Corp 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 CryptoStar Corp 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 CryptoStar Corp i.e., CryptoStar Corp and Granite Construction go up and down completely randomly.
Pair Corralation between CryptoStar Corp and Granite Construction
Assuming the 90 days horizon CryptoStar Corp is expected to generate 9.69 times more return on investment than Granite Construction. However, CryptoStar Corp is 9.69 times more volatile than Granite Construction Incorporated. It trades about 0.17 of its potential returns per unit of risk. Granite Construction Incorporated is currently generating about 0.53 per unit of risk. If you would invest 1.62 in CryptoStar Corp on August 25, 2024 and sell it today you would earn a total of 0.73 from holding CryptoStar Corp or generate 45.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CryptoStar Corp vs. Granite Construction Incorpora
Performance |
| Timeline |
| CryptoStar Corp |
| Granite Construction |
CryptoStar Corp and Granite Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CryptoStar Corp and Granite Construction
The main advantage of trading using opposite CryptoStar Corp and Granite Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CryptoStar Corp 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.| CryptoStar Corp vs. Morgan Stanley | CryptoStar Corp vs. Goldman Sachs Group | CryptoStar Corp vs. Charles Schwab Corp | CryptoStar Corp vs. Interactive Brokers Group |
| Granite Construction vs. EMCOR Group | Granite Construction vs. Comfort Systems USA | Granite Construction vs. Primoris Services | Granite Construction vs. Construction Partners |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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