Correlation Between First Graphene and Green Star
Can any of the company-specific risk be diversified away by investing in both First Graphene and Green Star 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 First Graphene and Green Star into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Graphene and Green Star Products, you can compare the effects of market volatilities on First Graphene and Green Star 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 First Graphene with a short position of Green Star. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Graphene and Green Star.
Diversification Opportunities for First Graphene and Green Star
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between First and Green is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding First Graphene and Green Star Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Green Star Products and First Graphene 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 First Graphene are associated (or correlated) with Green Star. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Green Star Products has no effect on the direction of First Graphene i.e., First Graphene and Green Star go up and down completely randomly.
Pair Corralation between First Graphene and Green Star
Assuming the 90 days horizon First Graphene is expected to generate 0.68 times more return on investment than Green Star. However, First Graphene is 1.48 times less risky than Green Star. It trades about -0.1 of its potential returns per unit of risk. Green Star Products is currently generating about -0.08 per unit of risk. If you would invest 3.00 in First Graphene on August 26, 2024 and sell it today you would lose (0.80) from holding First Graphene or give up 26.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Graphene vs. Green Star Products
Performance |
| Timeline |
| First Graphene |
| Green Star Products |
First Graphene and Green Star Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Graphene and Green Star
The main advantage of trading using opposite First Graphene and Green Star positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Graphene position performs unexpectedly, Green Star 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 Green Star will offset losses from the drop in Green Star's long position.| First Graphene vs. Haydale Graphene Industries | First Graphene vs. Versarien plc | First Graphene vs. NanoXplore | First Graphene vs. G6 Materials Corp |
| Green Star vs. First Graphene | Green Star vs. HUMANA INC | Green Star vs. Aquagold International | Green Star vs. Barloworld Ltd ADR |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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