Correlation Between Griffon and Ayala
Can any of the company-specific risk be diversified away by investing in both Griffon and Ayala 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 Ayala into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Griffon and Ayala, you can compare the effects of market volatilities on Griffon and Ayala 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 Ayala. Check out your portfolio center. Please also check ongoing floating volatility patterns of Griffon and Ayala.
Diversification Opportunities for Griffon and Ayala
Modest diversification
The 3 months correlation between Griffon and Ayala is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Griffon and Ayala in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ayala 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 Ayala. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ayala has no effect on the direction of Griffon i.e., Griffon and Ayala go up and down completely randomly.
Pair Corralation between Griffon and Ayala
If you would invest 6,438 in Griffon on August 24, 2024 and sell it today you would earn a total of 1,690 from holding Griffon or generate 26.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Griffon vs. Ayala
Performance |
| Timeline |
| Griffon |
| Ayala |
Griffon and Ayala Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Griffon and Ayala
The main advantage of trading using opposite Griffon and Ayala positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Griffon position performs unexpectedly, Ayala 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 Ayala will offset losses from the drop in Ayala's long position.| Griffon vs. Steel Partners Holdings | Griffon vs. Brookfield Business Partners | Griffon vs. Tejon Ranch Co | Griffon vs. Compass Diversified Holdings |
| Ayala vs. Digi International | Ayala vs. KVH Industries | Ayala vs. Dave Busters Entertainment | Ayala vs. Iridium Communications |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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