Correlation Between Graphite One and Focus Graphite
Can any of the company-specific risk be diversified away by investing in both Graphite One and Focus Graphite 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 Graphite One and Focus Graphite into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Graphite One and Focus Graphite, you can compare the effects of market volatilities on Graphite One and Focus Graphite 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 Graphite One with a short position of Focus Graphite. Check out your portfolio center. Please also check ongoing floating volatility patterns of Graphite One and Focus Graphite.
Diversification Opportunities for Graphite One and Focus Graphite
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Graphite and Focus is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Graphite One and Focus Graphite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Focus Graphite and Graphite One 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 Graphite One are associated (or correlated) with Focus Graphite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Focus Graphite has no effect on the direction of Graphite One i.e., Graphite One and Focus Graphite go up and down completely randomly.
Pair Corralation between Graphite One and Focus Graphite
Assuming the 90 days horizon Graphite One is expected to generate 0.54 times more return on investment than Focus Graphite. However, Graphite One is 1.84 times less risky than Focus Graphite. It trades about 0.01 of its potential returns per unit of risk. Focus Graphite is currently generating about -0.01 per unit of risk. If you would invest 61.00 in Graphite One on August 30, 2024 and sell it today you would lose (4.00) from holding Graphite One or give up 6.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Graphite One vs. Focus Graphite
Performance |
| Timeline |
| Graphite One |
| Focus Graphite |
Graphite One and Focus Graphite Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Graphite One and Focus Graphite
The main advantage of trading using opposite Graphite One and Focus Graphite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Graphite One position performs unexpectedly, Focus Graphite 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 Focus Graphite will offset losses from the drop in Focus Graphite's long position.| Graphite One vs. Silver Hammer Mining | Graphite One vs. Reyna Silver Corp | Graphite One vs. Guanajuato Silver | Graphite One vs. Silver One Resources |
| Focus Graphite vs. Silver Hammer Mining | Focus Graphite vs. Reyna Silver Corp | Focus Graphite vs. Guanajuato Silver | Focus Graphite vs. Silver One Resources |
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.
Other Complementary Tools
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |