Correlation Between Griffon and Titan International
Can any of the company-specific risk be diversified away by investing in both Griffon and Titan International 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 Titan International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Griffon and Titan International, you can compare the effects of market volatilities on Griffon and Titan International 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 Titan International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Griffon and Titan International.
Diversification Opportunities for Griffon and Titan International
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Griffon and Titan is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Griffon and Titan International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Titan International 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 Titan International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Titan International has no effect on the direction of Griffon i.e., Griffon and Titan International go up and down completely randomly.
Pair Corralation between Griffon and Titan International
Considering the 90-day investment horizon Griffon is expected to generate 0.86 times more return on investment than Titan International. However, Griffon is 1.16 times less risky than Titan International. It trades about 0.09 of its potential returns per unit of risk. Titan International is currently generating about -0.03 per unit of risk. If you would invest 3,334 in Griffon on September 3, 2024 and sell it today you would earn a total of 5,096 from holding Griffon or generate 152.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Griffon vs. Titan International
Performance |
| Timeline |
| Griffon |
| Titan International |
Griffon and Titan International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Griffon and Titan International
The main advantage of trading using opposite Griffon and Titan International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Griffon position performs unexpectedly, Titan International 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 Titan International will offset losses from the drop in Titan International's long position.| Griffon vs. Steel Partners Holdings | Griffon vs. Brookfield Business Partners | Griffon vs. Tejon Ranch Co | Griffon vs. Compass Diversified Holdings |
| Titan International vs. Shyft Group | Titan International vs. Manitowoc | Titan International vs. Oshkosh | Titan International vs. Terex |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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