Correlation Between Griffin Mining and Vulcan Materials
Can any of the company-specific risk be diversified away by investing in both Griffin Mining and Vulcan Materials 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 Griffin Mining and Vulcan Materials into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Griffin Mining and Vulcan Materials Co, you can compare the effects of market volatilities on Griffin Mining and Vulcan Materials 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 Griffin Mining with a short position of Vulcan Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of Griffin Mining and Vulcan Materials.
Diversification Opportunities for Griffin Mining and Vulcan Materials
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Griffin and Vulcan is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Griffin Mining and Vulcan Materials Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vulcan Materials and Griffin Mining 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 Griffin Mining are associated (or correlated) with Vulcan Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vulcan Materials has no effect on the direction of Griffin Mining i.e., Griffin Mining and Vulcan Materials go up and down completely randomly.
Pair Corralation between Griffin Mining and Vulcan Materials
Assuming the 90 days trading horizon Griffin Mining is expected to generate 1.48 times more return on investment than Vulcan Materials. However, Griffin Mining is 1.48 times more volatile than Vulcan Materials Co. It trades about 0.09 of its potential returns per unit of risk. Vulcan Materials Co is currently generating about 0.02 per unit of risk. If you would invest 14,200 in Griffin Mining on November 28, 2024 and sell it today you would earn a total of 4,100 from holding Griffin Mining or generate 28.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Griffin Mining vs. Vulcan Materials Co
Performance |
| Timeline |
| Griffin Mining |
| Vulcan Materials |
Griffin Mining and Vulcan Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Griffin Mining and Vulcan Materials
The main advantage of trading using opposite Griffin Mining and Vulcan Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Griffin Mining position performs unexpectedly, Vulcan Materials 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 Vulcan Materials will offset losses from the drop in Vulcan Materials' long position.| Griffin Mining vs. Air Products Chemicals | Griffin Mining vs. Cardinal Health | Griffin Mining vs. Planet Fitness Cl | Griffin Mining vs. Systemair AB |
| Vulcan Materials vs. Advanced Medical Solutions | Vulcan Materials vs. Creo Medical Group | Vulcan Materials vs. Elmos Semiconductor SE | Vulcan Materials vs. Geely Automobile 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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