Correlation Between Arch Capital and GRIFFIN MINING
Can any of the company-specific risk be diversified away by investing in both Arch Capital and GRIFFIN MINING 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 Arch Capital and GRIFFIN MINING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Arch Capital Group and GRIFFIN MINING LTD, you can compare the effects of market volatilities on Arch Capital and GRIFFIN MINING 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 Arch Capital with a short position of GRIFFIN MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arch Capital and GRIFFIN MINING.
Diversification Opportunities for Arch Capital and GRIFFIN MINING
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Arch and GRIFFIN is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Arch Capital Group and GRIFFIN MINING LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GRIFFIN MINING LTD and Arch Capital 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 Arch Capital Group are associated (or correlated) with GRIFFIN MINING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GRIFFIN MINING LTD has no effect on the direction of Arch Capital i.e., Arch Capital and GRIFFIN MINING go up and down completely randomly.
Pair Corralation between Arch Capital and GRIFFIN MINING
Assuming the 90 days horizon Arch Capital is expected to generate 1.38 times less return on investment than GRIFFIN MINING. But when comparing it to its historical volatility, Arch Capital Group is 1.33 times less risky than GRIFFIN MINING. It trades about 0.07 of its potential returns per unit of risk. GRIFFIN MINING LTD is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 80.00 in GRIFFIN MINING LTD on September 3, 2024 and sell it today you would earn a total of 91.00 from holding GRIFFIN MINING LTD or generate 113.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Arch Capital Group vs. GRIFFIN MINING LTD
Performance |
| Timeline |
| Arch Capital Group |
| GRIFFIN MINING LTD |
Arch Capital and GRIFFIN MINING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Arch Capital and GRIFFIN MINING
The main advantage of trading using opposite Arch Capital and GRIFFIN MINING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arch Capital position performs unexpectedly, GRIFFIN MINING 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 GRIFFIN MINING will offset losses from the drop in GRIFFIN MINING's long position.| Arch Capital vs. Berkshire Hathaway | Arch Capital vs. Berkshire Hathaway | Arch Capital vs. Superior Plus Corp | Arch Capital vs. NMI Holdings |
| GRIFFIN MINING vs. Cardinal Health | GRIFFIN MINING vs. ALERION CLEANPOWER | GRIFFIN MINING vs. Clean Energy Fuels | GRIFFIN MINING vs. FEMALE HEALTH |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |