Correlation Between Griffin Mining and EJF Investments
Can any of the company-specific risk be diversified away by investing in both Griffin Mining and EJF Investments 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 EJF Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Griffin Mining and EJF Investments, you can compare the effects of market volatilities on Griffin Mining and EJF Investments 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 EJF Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Griffin Mining and EJF Investments.
Diversification Opportunities for Griffin Mining and EJF Investments
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Griffin and EJF is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Griffin Mining and EJF Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EJF Investments 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 EJF Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EJF Investments has no effect on the direction of Griffin Mining i.e., Griffin Mining and EJF Investments go up and down completely randomly.
Pair Corralation between Griffin Mining and EJF Investments
Assuming the 90 days trading horizon Griffin Mining is expected to generate 5.73 times less return on investment than EJF Investments. In addition to that, Griffin Mining is 1.39 times more volatile than EJF Investments. It trades about 0.02 of its total potential returns per unit of risk. EJF Investments is currently generating about 0.14 per unit of volatility. If you would invest 9,962 in EJF Investments on November 2, 2024 and sell it today you would earn a total of 2,488 from holding EJF Investments or generate 24.97% 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. EJF Investments
Performance |
| Timeline |
| Griffin Mining |
| EJF Investments |
Griffin Mining and EJF Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Griffin Mining and EJF Investments
The main advantage of trading using opposite Griffin Mining and EJF Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Griffin Mining position performs unexpectedly, EJF Investments 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 EJF Investments will offset losses from the drop in EJF Investments' long position.| Griffin Mining vs. Check Point Software | Griffin Mining vs. Vietnam Enterprise Investments | Griffin Mining vs. Monks Investment Trust | Griffin Mining vs. Mobius Investment Trust |
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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