Correlation Between Graphene Manufacturing and Haydale Graphene
Can any of the company-specific risk be diversified away by investing in both Graphene Manufacturing and Haydale Graphene 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 Graphene Manufacturing and Haydale Graphene into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Graphene Manufacturing Group and Haydale Graphene Industries, you can compare the effects of market volatilities on Graphene Manufacturing and Haydale Graphene 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 Graphene Manufacturing with a short position of Haydale Graphene. Check out your portfolio center. Please also check ongoing floating volatility patterns of Graphene Manufacturing and Haydale Graphene.
Diversification Opportunities for Graphene Manufacturing and Haydale Graphene
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Graphene and Haydale is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Graphene Manufacturing Group and Haydale Graphene Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haydale Graphene Ind and Graphene Manufacturing 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 Graphene Manufacturing Group are associated (or correlated) with Haydale Graphene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haydale Graphene Ind has no effect on the direction of Graphene Manufacturing i.e., Graphene Manufacturing and Haydale Graphene go up and down completely randomly.
Pair Corralation between Graphene Manufacturing and Haydale Graphene
Assuming the 90 days horizon Graphene Manufacturing is expected to generate 5.58 times less return on investment than Haydale Graphene. But when comparing it to its historical volatility, Graphene Manufacturing Group is 3.62 times less risky than Haydale Graphene. It trades about 0.04 of its potential returns per unit of risk. Haydale Graphene Industries is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 0.59 in Haydale Graphene Industries on September 1, 2024 and sell it today you would lose (0.36) from holding Haydale Graphene Industries or give up 61.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Graphene Manufacturing Group vs. Haydale Graphene Industries
Performance |
| Timeline |
| Graphene Manufacturing |
| Haydale Graphene Ind |
Graphene Manufacturing and Haydale Graphene Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Graphene Manufacturing and Haydale Graphene
The main advantage of trading using opposite Graphene Manufacturing and Haydale Graphene positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Graphene Manufacturing position performs unexpectedly, Haydale Graphene 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 Haydale Graphene will offset losses from the drop in Haydale Graphene's long position.| Graphene Manufacturing vs. Iofina plc | Graphene Manufacturing vs. Nano One Materials | Graphene Manufacturing vs. Gevo Inc | Graphene Manufacturing vs. Haydale Graphene Industries |
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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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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