Correlation Between GRIFFIN MINING and Selective Insurance
Can any of the company-specific risk be diversified away by investing in both GRIFFIN MINING and Selective Insurance 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 Selective Insurance 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 Selective Insurance Group, you can compare the effects of market volatilities on GRIFFIN MINING and Selective Insurance 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 Selective Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of GRIFFIN MINING and Selective Insurance.
Diversification Opportunities for GRIFFIN MINING and Selective Insurance
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between GRIFFIN and Selective is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding GRIFFIN MINING LTD and Selective Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Selective Insurance 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 Selective Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Selective Insurance has no effect on the direction of GRIFFIN MINING i.e., GRIFFIN MINING and Selective Insurance go up and down completely randomly.
Pair Corralation between GRIFFIN MINING and Selective Insurance
Assuming the 90 days horizon GRIFFIN MINING is expected to generate 1.46 times less return on investment than Selective Insurance. In addition to that, GRIFFIN MINING is 1.26 times more volatile than Selective Insurance Group. It trades about 0.06 of its total potential returns per unit of risk. Selective Insurance Group is currently generating about 0.11 per unit of volatility. If you would invest 7,868 in Selective Insurance Group on August 28, 2024 and sell it today you would earn a total of 982.00 from holding Selective Insurance Group or generate 12.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.46% |
| Values | Daily Returns |
GRIFFIN MINING LTD vs. Selective Insurance Group
Performance |
| Timeline |
| GRIFFIN MINING LTD |
| Selective Insurance |
GRIFFIN MINING and Selective Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GRIFFIN MINING and Selective Insurance
The main advantage of trading using opposite GRIFFIN MINING and Selective Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GRIFFIN MINING position performs unexpectedly, Selective Insurance 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 Selective Insurance will offset losses from the drop in Selective Insurance's long position.| GRIFFIN MINING vs. Apple Inc | GRIFFIN MINING vs. Apple Inc | GRIFFIN MINING vs. Apple Inc | GRIFFIN MINING vs. Apple Inc |
| Selective Insurance vs. Superior Plus Corp | Selective Insurance vs. NMI Holdings | Selective Insurance vs. Origin Agritech | Selective Insurance vs. SIVERS SEMICONDUCTORS AB |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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