Correlation Between GRIFFIN MINING and COSTAR GROUP
Can any of the company-specific risk be diversified away by investing in both GRIFFIN MINING and COSTAR GROUP 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 COSTAR GROUP 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 COSTAR GROUP INC, you can compare the effects of market volatilities on GRIFFIN MINING and COSTAR GROUP 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 COSTAR GROUP. Check out your portfolio center. Please also check ongoing floating volatility patterns of GRIFFIN MINING and COSTAR GROUP.
Diversification Opportunities for GRIFFIN MINING and COSTAR GROUP
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between GRIFFIN and COSTAR is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding GRIFFIN MINING LTD and COSTAR GROUP INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COSTAR GROUP INC 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 COSTAR GROUP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COSTAR GROUP INC has no effect on the direction of GRIFFIN MINING i.e., GRIFFIN MINING and COSTAR GROUP go up and down completely randomly.
Pair Corralation between GRIFFIN MINING and COSTAR GROUP
Assuming the 90 days horizon GRIFFIN MINING LTD is expected to generate 1.18 times more return on investment than COSTAR GROUP. However, GRIFFIN MINING is 1.18 times more volatile than COSTAR GROUP INC. It trades about 0.08 of its potential returns per unit of risk. COSTAR GROUP INC is currently generating about 0.01 per unit of risk. If you would invest 80.00 in GRIFFIN MINING LTD on August 30, 2024 and sell it today you would earn a total of 92.00 from holding GRIFFIN MINING LTD or generate 115.0% 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. COSTAR GROUP INC
Performance |
| Timeline |
| GRIFFIN MINING LTD |
| COSTAR GROUP INC |
GRIFFIN MINING and COSTAR GROUP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GRIFFIN MINING and COSTAR GROUP
The main advantage of trading using opposite GRIFFIN MINING and COSTAR GROUP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GRIFFIN MINING position performs unexpectedly, COSTAR GROUP 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 COSTAR GROUP will offset losses from the drop in COSTAR GROUP'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 |
| COSTAR GROUP vs. Vonovia SE | COSTAR GROUP vs. Wharf Real Estate | COSTAR GROUP vs. Superior Plus Corp | COSTAR GROUP 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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