Correlation Between Electrovaya Common and Griffon
Can any of the company-specific risk be diversified away by investing in both Electrovaya Common and Griffon 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 Electrovaya Common and Griffon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Electrovaya Common Shares and Griffon, you can compare the effects of market volatilities on Electrovaya Common and Griffon 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 Electrovaya Common with a short position of Griffon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electrovaya Common and Griffon.
Diversification Opportunities for Electrovaya Common and Griffon
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Electrovaya and Griffon is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Electrovaya Common Shares and Griffon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Griffon and Electrovaya Common 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 Electrovaya Common Shares are associated (or correlated) with Griffon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Griffon has no effect on the direction of Electrovaya Common i.e., Electrovaya Common and Griffon go up and down completely randomly.
Pair Corralation between Electrovaya Common and Griffon
Given the investment horizon of 90 days Electrovaya Common Shares is expected to under-perform the Griffon. In addition to that, Electrovaya Common is 1.42 times more volatile than Griffon. It trades about -0.02 of its total potential returns per unit of risk. Griffon is currently generating about 0.09 per unit of volatility. If you would invest 3,191 in Griffon on August 24, 2024 and sell it today you would earn a total of 4,937 from holding Griffon or generate 154.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Electrovaya Common Shares vs. Griffon
Performance |
| Timeline |
| Electrovaya Common Shares |
| Griffon |
Electrovaya Common and Griffon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Electrovaya Common and Griffon
The main advantage of trading using opposite Electrovaya Common and Griffon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electrovaya Common position performs unexpectedly, Griffon 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 Griffon will offset losses from the drop in Griffon's long position.| Electrovaya Common vs. Plug Power | Electrovaya Common vs. Solid Power | Electrovaya Common vs. CBAK Energy Technology | Electrovaya Common vs. FuelCell Energy |
| Griffon vs. Steel Partners Holdings | Griffon vs. Brookfield Business Partners | Griffon vs. Tejon Ranch Co | Griffon vs. Compass Diversified Holdings |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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