Correlation Between SPORTING and GRIFFIN MINING
Can any of the company-specific risk be diversified away by investing in both SPORTING 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 SPORTING and GRIFFIN MINING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPORTING and GRIFFIN MINING LTD, you can compare the effects of market volatilities on SPORTING 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 SPORTING with a short position of GRIFFIN MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPORTING and GRIFFIN MINING.
Diversification Opportunities for SPORTING and GRIFFIN MINING
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SPORTING and GRIFFIN is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding SPORTING 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 SPORTING 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 SPORTING 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 SPORTING i.e., SPORTING and GRIFFIN MINING go up and down completely randomly.
Pair Corralation between SPORTING and GRIFFIN MINING
Assuming the 90 days trading horizon SPORTING is expected to under-perform the GRIFFIN MINING. But the stock apears to be less risky and, when comparing its historical volatility, SPORTING is 3.24 times less risky than GRIFFIN MINING. The stock trades about -0.28 of its potential returns per unit of risk. The GRIFFIN MINING LTD is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 174.00 in GRIFFIN MINING LTD on August 28, 2024 and sell it today you would lose (4.00) from holding GRIFFIN MINING LTD or give up 2.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPORTING vs. GRIFFIN MINING LTD
Performance |
| Timeline |
| SPORTING |
| GRIFFIN MINING LTD |
SPORTING and GRIFFIN MINING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPORTING and GRIFFIN MINING
The main advantage of trading using opposite SPORTING and GRIFFIN MINING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPORTING 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.| SPORTING vs. AEGEAN AIRLINES | SPORTING vs. TFS FINANCIAL | SPORTING vs. Mizuho Financial Group | SPORTING vs. SINGAPORE AIRLINES |
| GRIFFIN MINING vs. Apple Inc | GRIFFIN MINING vs. Apple Inc | GRIFFIN MINING vs. Apple Inc | GRIFFIN MINING vs. Apple Inc |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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