Correlation Between GRIFFIN MINING and Graham Holdings
Can any of the company-specific risk be diversified away by investing in both GRIFFIN MINING and Graham Holdings 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 Graham Holdings 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 Graham Holdings Co, you can compare the effects of market volatilities on GRIFFIN MINING and Graham Holdings 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 Graham Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of GRIFFIN MINING and Graham Holdings.
Diversification Opportunities for GRIFFIN MINING and Graham Holdings
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GRIFFIN and Graham is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding GRIFFIN MINING LTD and Graham Holdings Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Graham Holdings 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 Graham Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Graham Holdings has no effect on the direction of GRIFFIN MINING i.e., GRIFFIN MINING and Graham Holdings go up and down completely randomly.
Pair Corralation between GRIFFIN MINING and Graham Holdings
Assuming the 90 days horizon GRIFFIN MINING LTD is expected to under-perform the Graham Holdings. But the stock apears to be less risky and, when comparing its historical volatility, GRIFFIN MINING LTD is 1.58 times less risky than Graham Holdings. The stock trades about -0.1 of its potential returns per unit of risk. The Graham Holdings Co is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 72,323 in Graham Holdings Co on September 3, 2024 and sell it today you would earn a total of 16,177 from holding Graham Holdings Co or generate 22.37% 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. Graham Holdings Co
Performance |
| Timeline |
| GRIFFIN MINING LTD |
| Graham Holdings |
GRIFFIN MINING and Graham Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GRIFFIN MINING and Graham Holdings
The main advantage of trading using opposite GRIFFIN MINING and Graham Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GRIFFIN MINING position performs unexpectedly, Graham Holdings 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 Graham Holdings will offset losses from the drop in Graham Holdings' long position.| GRIFFIN MINING vs. Cardinal Health | GRIFFIN MINING vs. ALERION CLEANPOWER | GRIFFIN MINING vs. Clean Energy Fuels | GRIFFIN MINING vs. FEMALE HEALTH |
| Graham Holdings vs. Strategic Education | Graham Holdings vs. Laureate Education | Graham Holdings vs. COGNA EDUCACAO SPADR |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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