Correlation Between FAST RETAIL and Griffon
Can any of the company-specific risk be diversified away by investing in both FAST RETAIL 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 FAST RETAIL and Griffon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FAST RETAIL ADR and Griffon, you can compare the effects of market volatilities on FAST RETAIL 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 FAST RETAIL with a short position of Griffon. Check out your portfolio center. Please also check ongoing floating volatility patterns of FAST RETAIL and Griffon.
Diversification Opportunities for FAST RETAIL and Griffon
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between FAST and Griffon is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding FAST RETAIL ADR and Griffon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Griffon and FAST RETAIL 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 FAST RETAIL ADR 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 FAST RETAIL i.e., FAST RETAIL and Griffon go up and down completely randomly.
Pair Corralation between FAST RETAIL and Griffon
Assuming the 90 days trading horizon FAST RETAIL ADR is expected to under-perform the Griffon. In addition to that, FAST RETAIL is 1.55 times more volatile than Griffon. It trades about -0.16 of its total potential returns per unit of risk. Griffon is currently generating about 0.37 per unit of volatility. If you would invest 6,800 in Griffon on October 29, 2024 and sell it today you would earn a total of 650.00 from holding Griffon or generate 9.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FAST RETAIL ADR vs. Griffon
Performance |
| Timeline |
| FAST RETAIL ADR |
| Griffon |
FAST RETAIL and Griffon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FAST RETAIL and Griffon
The main advantage of trading using opposite FAST RETAIL and Griffon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FAST RETAIL 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.| FAST RETAIL vs. Townsquare Media | FAST RETAIL vs. DALATA HOTEL | FAST RETAIL vs. Sunstone Hotel Investors | FAST RETAIL vs. TOWNSQUARE MEDIA INC |
| Griffon vs. FIREWEED METALS P | Griffon vs. Jacquet Metal Service | Griffon vs. HEALTHSTREAM | Griffon vs. EPSILON HEALTHCARE LTD |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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