Correlation Between Griffon and WEBTOON Entertainment
Can any of the company-specific risk be diversified away by investing in both Griffon and WEBTOON Entertainment 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 WEBTOON Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Griffon and WEBTOON Entertainment Common, you can compare the effects of market volatilities on Griffon and WEBTOON Entertainment 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 WEBTOON Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Griffon and WEBTOON Entertainment.
Diversification Opportunities for Griffon and WEBTOON Entertainment
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Griffon and WEBTOON is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Griffon and WEBTOON Entertainment Common in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WEBTOON Entertainment 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 WEBTOON Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WEBTOON Entertainment has no effect on the direction of Griffon i.e., Griffon and WEBTOON Entertainment go up and down completely randomly.
Pair Corralation between Griffon and WEBTOON Entertainment
Considering the 90-day investment horizon Griffon is expected to generate 0.49 times more return on investment than WEBTOON Entertainment. However, Griffon is 2.04 times less risky than WEBTOON Entertainment. It trades about 0.07 of its potential returns per unit of risk. WEBTOON Entertainment Common is currently generating about -0.05 per unit of risk. If you would invest 3,651 in Griffon on November 2, 2024 and sell it today you would earn a total of 3,926 from holding Griffon or generate 107.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 30.36% |
| Values | Daily Returns |
Griffon vs. WEBTOON Entertainment Common
Performance |
| Timeline |
| Griffon |
| WEBTOON Entertainment |
Griffon and WEBTOON Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Griffon and WEBTOON Entertainment
The main advantage of trading using opposite Griffon and WEBTOON Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Griffon position performs unexpectedly, WEBTOON Entertainment 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 WEBTOON Entertainment will offset losses from the drop in WEBTOON Entertainment's long position.| Griffon vs. Steel Partners Holdings | Griffon vs. Brookfield Business Partners | Griffon vs. Tejon Ranch Co | Griffon vs. Compass Diversified Holdings |
| WEBTOON Entertainment vs. Nippon Steel Corp | WEBTOON Entertainment vs. Nexstar Broadcasting Group | WEBTOON Entertainment vs. Olympic Steel | WEBTOON Entertainment vs. Gfl Environmental 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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