Correlation Between GRIFFIN MINING and BLUESCOPE STEEL
Can any of the company-specific risk be diversified away by investing in both GRIFFIN MINING and BLUESCOPE STEEL 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 BLUESCOPE STEEL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GRIFFIN MINING LTD and BLUESCOPE STEEL, you can compare the effects of market volatilities on GRIFFIN MINING and BLUESCOPE STEEL 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 BLUESCOPE STEEL. Check out your portfolio center. Please also check ongoing floating volatility patterns of GRIFFIN MINING and BLUESCOPE STEEL.
Diversification Opportunities for GRIFFIN MINING and BLUESCOPE STEEL
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between GRIFFIN and BLUESCOPE is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding GRIFFIN MINING LTD and BLUESCOPE STEEL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BLUESCOPE STEEL 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 LTD are associated (or correlated) with BLUESCOPE STEEL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BLUESCOPE STEEL has no effect on the direction of GRIFFIN MINING i.e., GRIFFIN MINING and BLUESCOPE STEEL go up and down completely randomly.
Pair Corralation between GRIFFIN MINING and BLUESCOPE STEEL
Assuming the 90 days horizon GRIFFIN MINING LTD is expected to generate 0.62 times more return on investment than BLUESCOPE STEEL. However, GRIFFIN MINING LTD is 1.62 times less risky than BLUESCOPE STEEL. It trades about -0.05 of its potential returns per unit of risk. BLUESCOPE STEEL is currently generating about -0.04 per unit of risk. If you would invest 175.00 in GRIFFIN MINING LTD on September 14, 2024 and sell it today you would lose (3.00) from holding GRIFFIN MINING LTD or give up 1.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GRIFFIN MINING LTD vs. BLUESCOPE STEEL
Performance |
| Timeline |
| GRIFFIN MINING LTD |
| BLUESCOPE STEEL |
GRIFFIN MINING and BLUESCOPE STEEL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GRIFFIN MINING and BLUESCOPE STEEL
The main advantage of trading using opposite GRIFFIN MINING and BLUESCOPE STEEL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GRIFFIN MINING position performs unexpectedly, BLUESCOPE STEEL 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 BLUESCOPE STEEL will offset losses from the drop in BLUESCOPE STEEL's long position.| GRIFFIN MINING vs. Apple Inc | GRIFFIN MINING vs. Apple Inc | GRIFFIN MINING vs. Apple Inc | GRIFFIN MINING vs. Apple Inc |
| BLUESCOPE STEEL vs. Apple Inc | BLUESCOPE STEEL vs. Apple Inc | BLUESCOPE STEEL vs. Apple Inc | BLUESCOPE STEEL vs. Apple Inc |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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