Correlation Between GRIFFIN MINING and NORWEGIAN AIR
Can any of the company-specific risk be diversified away by investing in both GRIFFIN MINING and NORWEGIAN AIR 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 NORWEGIAN AIR 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 NORWEGIAN AIR SHUT, you can compare the effects of market volatilities on GRIFFIN MINING and NORWEGIAN AIR 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 NORWEGIAN AIR. Check out your portfolio center. Please also check ongoing floating volatility patterns of GRIFFIN MINING and NORWEGIAN AIR.
Diversification Opportunities for GRIFFIN MINING and NORWEGIAN AIR
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GRIFFIN and NORWEGIAN is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding GRIFFIN MINING LTD and NORWEGIAN AIR SHUT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NORWEGIAN AIR SHUT 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 NORWEGIAN AIR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NORWEGIAN AIR SHUT has no effect on the direction of GRIFFIN MINING i.e., GRIFFIN MINING and NORWEGIAN AIR go up and down completely randomly.
Pair Corralation between GRIFFIN MINING and NORWEGIAN AIR
Assuming the 90 days horizon GRIFFIN MINING is expected to generate 9.74 times less return on investment than NORWEGIAN AIR. But when comparing it to its historical volatility, GRIFFIN MINING LTD is 1.67 times less risky than NORWEGIAN AIR. It trades about 0.02 of its potential returns per unit of risk. NORWEGIAN AIR SHUT is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 84.00 in NORWEGIAN AIR SHUT on September 4, 2024 and sell it today you would earn a total of 7.00 from holding NORWEGIAN AIR SHUT or generate 8.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
GRIFFIN MINING LTD vs. NORWEGIAN AIR SHUT
Performance |
| Timeline |
| GRIFFIN MINING LTD |
| NORWEGIAN AIR SHUT |
GRIFFIN MINING and NORWEGIAN AIR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GRIFFIN MINING and NORWEGIAN AIR
The main advantage of trading using opposite GRIFFIN MINING and NORWEGIAN AIR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GRIFFIN MINING position performs unexpectedly, NORWEGIAN AIR 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 NORWEGIAN AIR will offset losses from the drop in NORWEGIAN AIR's long position.| GRIFFIN MINING vs. Apple Inc | GRIFFIN MINING vs. Apple Inc | GRIFFIN MINING vs. Apple Inc | GRIFFIN MINING vs. Apple Inc |
| NORWEGIAN AIR vs. TOTAL GABON | NORWEGIAN AIR vs. Walgreens Boots Alliance | NORWEGIAN AIR vs. Peak Resources Limited |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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