Correlation Between GraniteShares 15x and RiverFront Dynamic
Can any of the company-specific risk be diversified away by investing in both GraniteShares 15x and RiverFront Dynamic 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 GraniteShares 15x and RiverFront Dynamic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GraniteShares 15x Long and RiverFront Dynamic Dividend, you can compare the effects of market volatilities on GraniteShares 15x and RiverFront Dynamic 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 GraniteShares 15x with a short position of RiverFront Dynamic. Check out your portfolio center. Please also check ongoing floating volatility patterns of GraniteShares 15x and RiverFront Dynamic.
Diversification Opportunities for GraniteShares 15x and RiverFront Dynamic
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between GraniteShares and RiverFront is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding GraniteShares 15x Long and RiverFront Dynamic Dividend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RiverFront Dynamic and GraniteShares 15x 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 GraniteShares 15x Long are associated (or correlated) with RiverFront Dynamic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RiverFront Dynamic has no effect on the direction of GraniteShares 15x i.e., GraniteShares 15x and RiverFront Dynamic go up and down completely randomly.
Pair Corralation between GraniteShares 15x and RiverFront Dynamic
Given the investment horizon of 90 days GraniteShares 15x Long is expected to generate 6.51 times more return on investment than RiverFront Dynamic. However, GraniteShares 15x is 6.51 times more volatile than RiverFront Dynamic Dividend. It trades about 0.13 of its potential returns per unit of risk. RiverFront Dynamic Dividend is currently generating about 0.08 per unit of risk. If you would invest 391.00 in GraniteShares 15x Long on September 2, 2024 and sell it today you would earn a total of 6,798 from holding GraniteShares 15x Long or generate 1738.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.8% |
| Values | Daily Returns |
GraniteShares 15x Long vs. RiverFront Dynamic Dividend
Performance |
| Timeline |
| GraniteShares 15x Long |
| RiverFront Dynamic |
GraniteShares 15x and RiverFront Dynamic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GraniteShares 15x and RiverFront Dynamic
The main advantage of trading using opposite GraniteShares 15x and RiverFront Dynamic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GraniteShares 15x position performs unexpectedly, RiverFront Dynamic 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 RiverFront Dynamic will offset losses from the drop in RiverFront Dynamic's long position.| GraniteShares 15x vs. Direxion Daily MSFT | GraniteShares 15x vs. Direxion Daily GOOGL | GraniteShares 15x vs. AXS 125X NVDA | GraniteShares 15x vs. Direxion Shares ETF |
| RiverFront Dynamic vs. RiverFront Dynamic Flex Cap | RiverFront Dynamic vs. RiverFront Dynamic Core | RiverFront Dynamic vs. RiverFront Strategic Income | RiverFront Dynamic vs. First Trust RiverFront |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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