Correlation Between Griffon and Grupo Aeroportuario
Can any of the company-specific risk be diversified away by investing in both Griffon and Grupo Aeroportuario 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 Grupo Aeroportuario into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Griffon and Grupo Aeroportuario del, you can compare the effects of market volatilities on Griffon and Grupo Aeroportuario 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 Grupo Aeroportuario. Check out your portfolio center. Please also check ongoing floating volatility patterns of Griffon and Grupo Aeroportuario.
Diversification Opportunities for Griffon and Grupo Aeroportuario
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Griffon and Grupo is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Griffon and Grupo Aeroportuario del in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Aeroportuario del 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 Grupo Aeroportuario. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Aeroportuario del has no effect on the direction of Griffon i.e., Griffon and Grupo Aeroportuario go up and down completely randomly.
Pair Corralation between Griffon and Grupo Aeroportuario
Considering the 90-day investment horizon Griffon is expected to generate 2.77 times more return on investment than Grupo Aeroportuario. However, Griffon is 2.77 times more volatile than Grupo Aeroportuario del. It trades about 0.32 of its potential returns per unit of risk. Grupo Aeroportuario del is currently generating about -0.14 per unit of risk. If you would invest 6,436 in Griffon on August 28, 2024 and sell it today you would earn a total of 2,080 from holding Griffon or generate 32.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Griffon vs. Grupo Aeroportuario del
Performance |
| Timeline |
| Griffon |
| Grupo Aeroportuario del |
Griffon and Grupo Aeroportuario Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Griffon and Grupo Aeroportuario
The main advantage of trading using opposite Griffon and Grupo Aeroportuario positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Griffon position performs unexpectedly, Grupo Aeroportuario 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 Grupo Aeroportuario will offset losses from the drop in Grupo Aeroportuario's long position.| Griffon vs. Steel Partners Holdings | Griffon vs. Brookfield Business Partners | Griffon vs. Tejon Ranch Co | Griffon vs. Compass Diversified Holdings |
| Grupo Aeroportuario vs. Wheels Up Experience | Grupo Aeroportuario vs. Grupo Aeroportuario del | Grupo Aeroportuario vs. Joby Aviation | Grupo Aeroportuario vs. Grupo Aeroportuario del |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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