Correlation Between GRIFFIN MINING and Compagnie Plastic
Can any of the company-specific risk be diversified away by investing in both GRIFFIN MINING and Compagnie Plastic 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 Compagnie Plastic 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 Compagnie Plastic Omnium, you can compare the effects of market volatilities on GRIFFIN MINING and Compagnie Plastic 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 Compagnie Plastic. Check out your portfolio center. Please also check ongoing floating volatility patterns of GRIFFIN MINING and Compagnie Plastic.
Diversification Opportunities for GRIFFIN MINING and Compagnie Plastic
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between GRIFFIN and Compagnie is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding GRIFFIN MINING LTD and Compagnie Plastic Omnium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compagnie Plastic Omnium 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 Compagnie Plastic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compagnie Plastic Omnium has no effect on the direction of GRIFFIN MINING i.e., GRIFFIN MINING and Compagnie Plastic go up and down completely randomly.
Pair Corralation between GRIFFIN MINING and Compagnie Plastic
Assuming the 90 days horizon GRIFFIN MINING LTD is expected to generate 0.82 times more return on investment than Compagnie Plastic. However, GRIFFIN MINING LTD is 1.22 times less risky than Compagnie Plastic. It trades about 0.11 of its potential returns per unit of risk. Compagnie Plastic Omnium is currently generating about -0.07 per unit of risk. If you would invest 87.00 in GRIFFIN MINING LTD on August 29, 2024 and sell it today you would earn a total of 85.00 from holding GRIFFIN MINING LTD or generate 97.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GRIFFIN MINING LTD vs. Compagnie Plastic Omnium
Performance |
| Timeline |
| GRIFFIN MINING LTD |
| Compagnie Plastic Omnium |
GRIFFIN MINING and Compagnie Plastic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GRIFFIN MINING and Compagnie Plastic
The main advantage of trading using opposite GRIFFIN MINING and Compagnie Plastic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GRIFFIN MINING position performs unexpectedly, Compagnie Plastic 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 Compagnie Plastic will offset losses from the drop in Compagnie Plastic's long position.| GRIFFIN MINING vs. BW OFFSHORE LTD | GRIFFIN MINING vs. Eidesvik Offshore ASA | GRIFFIN MINING vs. Liberty Broadband | GRIFFIN MINING vs. Sekisui Chemical Co |
| Compagnie Plastic vs. PT Astra International | Compagnie Plastic vs. Continental Aktiengesellschaft | Compagnie Plastic vs. Superior Plus Corp | Compagnie Plastic vs. NMI 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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