Correlation Between Varta AG and Granite Construction
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By analyzing existing cross correlation between Varta AG and Granite Construction, you can compare the effects of market volatilities on Varta AG and Granite Construction 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 Varta AG with a short position of Granite Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Varta AG and Granite Construction.
Diversification Opportunities for Varta AG and Granite Construction
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Varta and Granite is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Varta AG and Granite Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Granite Construction and Varta AG 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 Varta AG are associated (or correlated) with Granite Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Granite Construction has no effect on the direction of Varta AG i.e., Varta AG and Granite Construction go up and down completely randomly.
Pair Corralation between Varta AG and Granite Construction
Assuming the 90 days trading horizon Varta AG is expected to under-perform the Granite Construction. In addition to that, Varta AG is 4.38 times more volatile than Granite Construction. It trades about -0.2 of its total potential returns per unit of risk. Granite Construction is currently generating about 0.05 per unit of volatility. If you would invest 9,150 in Granite Construction on September 13, 2024 and sell it today you would earn a total of 100.00 from holding Granite Construction or generate 1.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Varta AG vs. Granite Construction
Performance |
| Timeline |
| Varta AG |
| Granite Construction |
Varta AG and Granite Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Varta AG and Granite Construction
The main advantage of trading using opposite Varta AG and Granite Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Varta AG position performs unexpectedly, Granite Construction 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 Granite Construction will offset losses from the drop in Granite Construction's long position.| Varta AG vs. SLR Investment Corp | Varta AG vs. Ping An Insurance | Varta AG vs. ZURICH INSURANCE GROUP | Varta AG vs. REINET INVESTMENTS SCA |
| Granite Construction vs. Apple Inc | Granite Construction vs. Apple Inc | Granite Construction vs. Apple Inc | Granite Construction 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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