Correlation Between Kandi Technologies and Griffon
Can any of the company-specific risk be diversified away by investing in both Kandi Technologies and Griffon 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 Kandi Technologies and Griffon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kandi Technologies Group and Griffon, you can compare the effects of market volatilities on Kandi Technologies and Griffon 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 Kandi Technologies with a short position of Griffon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kandi Technologies and Griffon.
Diversification Opportunities for Kandi Technologies and Griffon
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kandi and Griffon is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Kandi Technologies Group and Griffon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Griffon and Kandi Technologies 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 Kandi Technologies Group are associated (or correlated) with Griffon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Griffon has no effect on the direction of Kandi Technologies i.e., Kandi Technologies and Griffon go up and down completely randomly.
Pair Corralation between Kandi Technologies and Griffon
Given the investment horizon of 90 days Kandi Technologies Group is expected to under-perform the Griffon. In addition to that, Kandi Technologies is 1.09 times more volatile than Griffon. It trades about -0.1 of its total potential returns per unit of risk. Griffon is currently generating about 0.3 per unit of volatility. If you would invest 6,325 in Griffon on August 30, 2024 and sell it today you would earn a total of 2,026 from holding Griffon or generate 32.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kandi Technologies Group vs. Griffon
Performance |
| Timeline |
| Kandi Technologies |
| Griffon |
Kandi Technologies and Griffon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kandi Technologies and Griffon
The main advantage of trading using opposite Kandi Technologies and Griffon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kandi Technologies position performs unexpectedly, Griffon 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 Griffon will offset losses from the drop in Griffon's long position.| Kandi Technologies vs. Ford Motor | Kandi Technologies vs. General Motors | Kandi Technologies vs. Goodyear Tire Rubber | Kandi Technologies vs. Li Auto |
| Griffon vs. Steel Partners Holdings | Griffon vs. Brookfield Business Partners | Griffon vs. Tejon Ranch Co | Griffon vs. Compass Diversified Holdings |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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