Correlation Between Scottish Mortgage and GraniteShares
Can any of the company-specific risk be diversified away by investing in both Scottish Mortgage and GraniteShares 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 Scottish Mortgage and GraniteShares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scottish Mortgage Investment and GraniteShares 3x Short, you can compare the effects of market volatilities on Scottish Mortgage and GraniteShares 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 Scottish Mortgage with a short position of GraniteShares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scottish Mortgage and GraniteShares.
Diversification Opportunities for Scottish Mortgage and GraniteShares
-0.87 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Scottish and GraniteShares is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Scottish Mortgage Investment and GraniteShares 3x Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GraniteShares 3x Short and Scottish Mortgage 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 Scottish Mortgage Investment are associated (or correlated) with GraniteShares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GraniteShares 3x Short has no effect on the direction of Scottish Mortgage i.e., Scottish Mortgage and GraniteShares go up and down completely randomly.
Pair Corralation between Scottish Mortgage and GraniteShares
Assuming the 90 days trading horizon Scottish Mortgage Investment is expected to generate 0.23 times more return on investment than GraniteShares. However, Scottish Mortgage Investment is 4.3 times less risky than GraniteShares. It trades about 0.33 of its potential returns per unit of risk. GraniteShares 3x Short is currently generating about -0.36 per unit of risk. If you would invest 87,186 in Scottish Mortgage Investment on September 2, 2024 and sell it today you would earn a total of 7,094 from holding Scottish Mortgage Investment or generate 8.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Scottish Mortgage Investment vs. GraniteShares 3x Short
Performance |
| Timeline |
| Scottish Mortgage |
| GraniteShares 3x Short |
Scottish Mortgage and GraniteShares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scottish Mortgage and GraniteShares
The main advantage of trading using opposite Scottish Mortgage and GraniteShares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scottish Mortgage position performs unexpectedly, GraniteShares 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 GraniteShares will offset losses from the drop in GraniteShares' long position.| Scottish Mortgage vs. iShares MSCI Japan | Scottish Mortgage vs. Amundi EUR High | Scottish Mortgage vs. iShares JP Morgan | Scottish Mortgage vs. Xtrackers MSCI |
| GraniteShares vs. GraniteShares 3x Short | GraniteShares vs. GraniteShares 3x Long | GraniteShares vs. GraniteShares 3x Long | GraniteShares vs. GraniteShares 1x Short |
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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