Correlation Between Griffon and Getty Images
Can any of the company-specific risk be diversified away by investing in both Griffon and Getty Images 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 Getty Images into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Griffon and Getty Images Holdings, you can compare the effects of market volatilities on Griffon and Getty Images 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 Getty Images. Check out your portfolio center. Please also check ongoing floating volatility patterns of Griffon and Getty Images.
Diversification Opportunities for Griffon and Getty Images
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Griffon and Getty is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Griffon and Getty Images Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Getty Images Holdings 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 Getty Images. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Getty Images Holdings has no effect on the direction of Griffon i.e., Griffon and Getty Images go up and down completely randomly.
Pair Corralation between Griffon and Getty Images
Considering the 90-day investment horizon Griffon is expected to generate 0.81 times more return on investment than Getty Images. However, Griffon is 1.24 times less risky than Getty Images. It trades about -0.11 of its potential returns per unit of risk. Getty Images Holdings is currently generating about -0.2 per unit of risk. If you would invest 7,750 in Griffon on December 1, 2024 and sell it today you would lose (516.00) from holding Griffon or give up 6.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Griffon vs. Getty Images Holdings
Performance |
| Timeline |
| Griffon |
| Getty Images Holdings |
Griffon and Getty Images Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Griffon and Getty Images
The main advantage of trading using opposite Griffon and Getty Images positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Griffon position performs unexpectedly, Getty Images 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 Getty Images will offset losses from the drop in Getty Images' long position.| Griffon vs. Steel Partners Holdings | Griffon vs. Brookfield Business Partners | Griffon vs. Tejon Ranch Co | Griffon vs. Compass Diversified Holdings |
| Getty Images vs. Twilio Inc | Getty Images vs. Baidu Inc | Getty Images vs. Snap Inc | Getty Images vs. ANGI Homeservices |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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