Correlation Between Graham Holdings and Univest Pennsylvania
Can any of the company-specific risk be diversified away by investing in both Graham Holdings and Univest Pennsylvania 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 Graham Holdings and Univest Pennsylvania into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Graham Holdings Co and Univest Pennsylvania, you can compare the effects of market volatilities on Graham Holdings and Univest Pennsylvania 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 Graham Holdings with a short position of Univest Pennsylvania. Check out your portfolio center. Please also check ongoing floating volatility patterns of Graham Holdings and Univest Pennsylvania.
Diversification Opportunities for Graham Holdings and Univest Pennsylvania
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Graham and Univest is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Graham Holdings Co and Univest Pennsylvania in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Univest Pennsylvania and Graham Holdings 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 Graham Holdings Co are associated (or correlated) with Univest Pennsylvania. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Univest Pennsylvania has no effect on the direction of Graham Holdings i.e., Graham Holdings and Univest Pennsylvania go up and down completely randomly.
Pair Corralation between Graham Holdings and Univest Pennsylvania
Considering the 90-day investment horizon Graham Holdings Co is expected to generate 0.75 times more return on investment than Univest Pennsylvania. However, Graham Holdings Co is 1.33 times less risky than Univest Pennsylvania. It trades about 0.05 of its potential returns per unit of risk. Univest Pennsylvania is currently generating about 0.03 per unit of risk. If you would invest 64,728 in Graham Holdings Co on October 23, 2024 and sell it today you would earn a total of 25,822 from holding Graham Holdings Co or generate 39.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Graham Holdings Co vs. Univest Pennsylvania
Performance |
| Timeline |
| Graham Holdings |
| Univest Pennsylvania |
Graham Holdings and Univest Pennsylvania Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Graham Holdings and Univest Pennsylvania
The main advantage of trading using opposite Graham Holdings and Univest Pennsylvania positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Graham Holdings position performs unexpectedly, Univest Pennsylvania 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 Univest Pennsylvania will offset losses from the drop in Univest Pennsylvania's long position.| Graham Holdings vs. Cable One | Graham Holdings vs. Adtalem Global Education | Graham Holdings vs. Axalta Coating Systems | Graham Holdings vs. Madison Square Garden |
| Univest Pennsylvania vs. Waterstone Financial | Univest Pennsylvania vs. Mid Penn Bancorp | Univest Pennsylvania vs. ST Bancorp | Univest Pennsylvania vs. Republic Bancorp |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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