Correlation Between GRIN and Altlayer
Can any of the company-specific risk be diversified away by investing in both GRIN and Altlayer 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 GRIN and Altlayer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GRIN and Altlayer, you can compare the effects of market volatilities on GRIN and Altlayer 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 GRIN with a short position of Altlayer. Check out your portfolio center. Please also check ongoing floating volatility patterns of GRIN and Altlayer.
Diversification Opportunities for GRIN and Altlayer
Almost no diversification
The 3 months correlation between GRIN and Altlayer is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding GRIN and Altlayer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altlayer and GRIN 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 GRIN are associated (or correlated) with Altlayer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altlayer has no effect on the direction of GRIN i.e., GRIN and Altlayer go up and down completely randomly.
Pair Corralation between GRIN and Altlayer
Assuming the 90 days trading horizon GRIN is expected to generate 0.84 times more return on investment than Altlayer. However, GRIN is 1.19 times less risky than Altlayer. It trades about -0.15 of its potential returns per unit of risk. Altlayer is currently generating about -0.41 per unit of risk. If you would invest 2.95 in GRIN on November 8, 2024 and sell it today you would lose (0.76) from holding GRIN or give up 25.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
GRIN vs. Altlayer
Performance |
| Timeline |
| GRIN |
| Altlayer |
GRIN and Altlayer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GRIN and Altlayer
The main advantage of trading using opposite GRIN and Altlayer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GRIN position performs unexpectedly, Altlayer 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 Altlayer will offset losses from the drop in Altlayer's long position.The idea behind GRIN and Altlayer pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Stocks Directory Find actively traded stocks across global markets |