Correlation Between Griffon and YTL Berhad
Can any of the company-specific risk be diversified away by investing in both Griffon and YTL Berhad 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 YTL Berhad into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Griffon and YTL Berhad, you can compare the effects of market volatilities on Griffon and YTL Berhad 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 YTL Berhad. Check out your portfolio center. Please also check ongoing floating volatility patterns of Griffon and YTL Berhad.
Diversification Opportunities for Griffon and YTL Berhad
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Griffon and YTL is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Griffon and YTL Berhad in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YTL Berhad 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 YTL Berhad. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YTL Berhad has no effect on the direction of Griffon i.e., Griffon and YTL Berhad go up and down completely randomly.
Pair Corralation between Griffon and YTL Berhad
Considering the 90-day investment horizon Griffon is expected to generate 1.65 times more return on investment than YTL Berhad. However, Griffon is 1.65 times more volatile than YTL Berhad. It trades about 0.16 of its potential returns per unit of risk. YTL Berhad is currently generating about 0.22 per unit of risk. If you would invest 6,980 in Griffon on September 12, 2024 and sell it today you would earn a total of 1,027 from holding Griffon or generate 14.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.91% |
| Values | Daily Returns |
Griffon vs. YTL Berhad
Performance |
| Timeline |
| Griffon |
| YTL Berhad |
Griffon and YTL Berhad Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Griffon and YTL Berhad
The main advantage of trading using opposite Griffon and YTL Berhad positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Griffon position performs unexpectedly, YTL Berhad 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 YTL Berhad will offset losses from the drop in YTL Berhad's long position.| Griffon vs. Steel Partners Holdings | Griffon vs. Brookfield Business Partners | Griffon vs. Tejon Ranch Co | Griffon vs. Compass Diversified Holdings |
| YTL Berhad vs. Copa Holdings SA | YTL Berhad vs. United Airlines Holdings | YTL Berhad vs. Delta Air Lines | YTL Berhad vs. SkyWest |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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