Correlation Between GraniteShares 125x and Emeren
Can any of the company-specific risk be diversified away by investing in both GraniteShares 125x and Emeren 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 125x and Emeren into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GraniteShares 125x Long and Emeren Group, you can compare the effects of market volatilities on GraniteShares 125x and Emeren 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 125x with a short position of Emeren. Check out your portfolio center. Please also check ongoing floating volatility patterns of GraniteShares 125x and Emeren.
Diversification Opportunities for GraniteShares 125x and Emeren
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GraniteShares and Emeren is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding GraniteShares 125x Long and Emeren Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emeren Group and GraniteShares 125x 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 125x Long are associated (or correlated) with Emeren. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emeren Group has no effect on the direction of GraniteShares 125x i.e., GraniteShares 125x and Emeren go up and down completely randomly.
Pair Corralation between GraniteShares 125x and Emeren
Considering the 90-day investment horizon GraniteShares 125x Long is expected to generate 1.15 times more return on investment than Emeren. However, GraniteShares 125x is 1.15 times more volatile than Emeren Group. It trades about 0.05 of its potential returns per unit of risk. Emeren Group is currently generating about -0.03 per unit of risk. If you would invest 851.00 in GraniteShares 125x Long on August 26, 2024 and sell it today you would earn a total of 690.00 from holding GraniteShares 125x Long or generate 81.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GraniteShares 125x Long vs. Emeren Group
Performance |
| Timeline |
| GraniteShares 125x Long |
| Emeren Group |
GraniteShares 125x and Emeren Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GraniteShares 125x and Emeren
The main advantage of trading using opposite GraniteShares 125x and Emeren positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GraniteShares 125x position performs unexpectedly, Emeren 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 Emeren will offset losses from the drop in Emeren's long position.| GraniteShares 125x vs. Direxion Daily SP | GraniteShares 125x vs. Direxion Daily Semiconductor | GraniteShares 125x vs. Direxion Daily Semiconductor |
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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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