Correlation Between Granite Construction and Lavras Gold
Can any of the company-specific risk be diversified away by investing in both Granite Construction and Lavras Gold 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 Lavras Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Granite Construction Incorporated and Lavras Gold Corp, you can compare the effects of market volatilities on Granite Construction and Lavras Gold 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 Lavras Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Granite Construction and Lavras Gold.
Diversification Opportunities for Granite Construction and Lavras Gold
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Granite and Lavras is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Granite Construction Incorpora and Lavras Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lavras Gold Corp 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 Incorporated are associated (or correlated) with Lavras Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lavras Gold Corp has no effect on the direction of Granite Construction i.e., Granite Construction and Lavras Gold go up and down completely randomly.
Pair Corralation between Granite Construction and Lavras Gold
Considering the 90-day investment horizon Granite Construction Incorporated is expected to generate 0.32 times more return on investment than Lavras Gold. However, Granite Construction Incorporated is 3.17 times less risky than Lavras Gold. It trades about 0.55 of its potential returns per unit of risk. Lavras Gold Corp is currently generating about -0.08 per unit of risk. If you would invest 8,405 in Granite Construction Incorporated on September 1, 2024 and sell it today you would earn a total of 1,532 from holding Granite Construction Incorporated or generate 18.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Granite Construction Incorpora vs. Lavras Gold Corp
Performance |
| Timeline |
| Granite Construction |
| Lavras Gold Corp |
Granite Construction and Lavras Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Granite Construction and Lavras Gold
The main advantage of trading using opposite Granite Construction and Lavras Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Granite Construction position performs unexpectedly, Lavras Gold 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 Lavras Gold will offset losses from the drop in Lavras Gold's long position.| Granite Construction vs. EMCOR Group | Granite Construction vs. Comfort Systems USA | Granite Construction vs. Primoris Services | Granite Construction vs. Construction Partners |
| Lavras Gold vs. Aurion Resources | Lavras Gold vs. Rio2 Limited | Lavras Gold vs. Palamina Corp | Lavras Gold vs. BTU Metals Corp |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
Other Complementary Tools
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites |