Correlation Between Granite Construction and Performance Food
Can any of the company-specific risk be diversified away by investing in both Granite Construction and Performance Food 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 Granite Construction and Performance Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Granite Construction and Performance Food Group, you can compare the effects of market volatilities on Granite Construction and Performance Food 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 Granite Construction with a short position of Performance Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Granite Construction and Performance Food.
Diversification Opportunities for Granite Construction and Performance Food
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Granite and Performance is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Granite Construction and Performance Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Performance Food and Granite Construction 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 Granite Construction are associated (or correlated) with Performance Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Performance Food has no effect on the direction of Granite Construction i.e., Granite Construction and Performance Food go up and down completely randomly.
Pair Corralation between Granite Construction and Performance Food
Assuming the 90 days trading horizon Granite Construction is expected to generate 1.33 times more return on investment than Performance Food. However, Granite Construction is 1.33 times more volatile than Performance Food Group. It trades about 0.11 of its potential returns per unit of risk. Performance Food Group is currently generating about 0.06 per unit of risk. If you would invest 3,201 in Granite Construction on September 3, 2024 and sell it today you would earn a total of 6,049 from holding Granite Construction or generate 188.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Granite Construction vs. Performance Food Group
Performance |
| Timeline |
| Granite Construction |
| Performance Food |
Granite Construction and Performance Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Granite Construction and Performance Food
The main advantage of trading using opposite Granite Construction and Performance Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Granite Construction position performs unexpectedly, Performance Food 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 Performance Food will offset losses from the drop in Performance Food's long position.| Granite Construction vs. Apple Inc | Granite Construction vs. Apple Inc | Granite Construction vs. Apple Inc | Granite Construction vs. Apple Inc |
| Performance Food vs. China BlueChemical | Performance Food vs. AIR PRODCHEMICALS | Performance Food vs. Siamgas And Petrochemicals | Performance Food vs. Sanyo Chemical Industries |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |