Correlation Between Griffon and Aquestive Therapeutics
Can any of the company-specific risk be diversified away by investing in both Griffon and Aquestive Therapeutics 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 Griffon and Aquestive Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Griffon and Aquestive Therapeutics, you can compare the effects of market volatilities on Griffon and Aquestive Therapeutics 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 Griffon with a short position of Aquestive Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Griffon and Aquestive Therapeutics.
Diversification Opportunities for Griffon and Aquestive Therapeutics
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Griffon and Aquestive is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Griffon and Aquestive Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aquestive Therapeutics and Griffon 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 Griffon are associated (or correlated) with Aquestive Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aquestive Therapeutics has no effect on the direction of Griffon i.e., Griffon and Aquestive Therapeutics go up and down completely randomly.
Pair Corralation between Griffon and Aquestive Therapeutics
Considering the 90-day investment horizon Griffon is expected to generate 1.98 times less return on investment than Aquestive Therapeutics. But when comparing it to its historical volatility, Griffon is 1.85 times less risky than Aquestive Therapeutics. It trades about 0.08 of its potential returns per unit of risk. Aquestive Therapeutics is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 197.00 in Aquestive Therapeutics on September 4, 2024 and sell it today you would earn a total of 242.00 from holding Aquestive Therapeutics or generate 122.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Griffon vs. Aquestive Therapeutics
Performance |
| Timeline |
| Griffon |
| Aquestive Therapeutics |
Griffon and Aquestive Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Griffon and Aquestive Therapeutics
The main advantage of trading using opposite Griffon and Aquestive Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Griffon position performs unexpectedly, Aquestive Therapeutics 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 Aquestive Therapeutics will offset losses from the drop in Aquestive Therapeutics' long position.| Griffon vs. Steel Partners Holdings | Griffon vs. Brookfield Business Partners | Griffon vs. Tejon Ranch Co | Griffon vs. Compass Diversified Holdings |
| Aquestive Therapeutics vs. Evoke Pharma | Aquestive Therapeutics vs. Dynavax Technologies | Aquestive Therapeutics vs. Amphastar P | Aquestive Therapeutics vs. Lantheus 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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