Correlation Between GRIFFIN MINING and Mitsubishi Materials
Can any of the company-specific risk be diversified away by investing in both GRIFFIN MINING and Mitsubishi 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 Mitsubishi Materials 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 Mitsubishi Materials, you can compare the effects of market volatilities on GRIFFIN MINING and Mitsubishi 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 Mitsubishi Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of GRIFFIN MINING and Mitsubishi Materials.
Diversification Opportunities for GRIFFIN MINING and Mitsubishi Materials
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between GRIFFIN and Mitsubishi is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding GRIFFIN MINING LTD and Mitsubishi Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mitsubishi 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 LTD are associated (or correlated) with Mitsubishi Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mitsubishi Materials has no effect on the direction of GRIFFIN MINING i.e., GRIFFIN MINING and Mitsubishi Materials go up and down completely randomly.
Pair Corralation between GRIFFIN MINING and Mitsubishi Materials
Assuming the 90 days horizon GRIFFIN MINING LTD is expected to generate 1.08 times more return on investment than Mitsubishi Materials. However, GRIFFIN MINING is 1.08 times more volatile than Mitsubishi Materials. It trades about 0.07 of its potential returns per unit of risk. Mitsubishi Materials is currently generating about 0.01 per unit of risk. If you would invest 101.00 in GRIFFIN MINING LTD on August 26, 2024 and sell it today you would earn a total of 64.00 from holding GRIFFIN MINING LTD or generate 63.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GRIFFIN MINING LTD vs. Mitsubishi Materials
Performance |
| Timeline |
| GRIFFIN MINING LTD |
| Mitsubishi Materials |
GRIFFIN MINING and Mitsubishi Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GRIFFIN MINING and Mitsubishi Materials
The main advantage of trading using opposite GRIFFIN MINING and Mitsubishi Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GRIFFIN MINING position performs unexpectedly, Mitsubishi 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 Mitsubishi Materials will offset losses from the drop in Mitsubishi Materials' long position.| GRIFFIN MINING vs. JSC Halyk bank | GRIFFIN MINING vs. REVO INSURANCE SPA | GRIFFIN MINING vs. MINCO SILVER | GRIFFIN MINING vs. The Hanover Insurance |
| Mitsubishi Materials vs. Apple Inc | Mitsubishi Materials vs. Apple Inc | Mitsubishi Materials vs. Apple Inc | Mitsubishi Materials 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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