Correlation Between Seven West and GRIFFIN MINING
Can any of the company-specific risk be diversified away by investing in both Seven West 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 Seven West and GRIFFIN MINING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Seven West Media and GRIFFIN MINING LTD, you can compare the effects of market volatilities on Seven West 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 Seven West with a short position of GRIFFIN MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seven West and GRIFFIN MINING.
Diversification Opportunities for Seven West and GRIFFIN MINING
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Seven and GRIFFIN is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Seven West Media 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 Seven West 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 Seven West Media 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 Seven West i.e., Seven West and GRIFFIN MINING go up and down completely randomly.
Pair Corralation between Seven West and GRIFFIN MINING
Assuming the 90 days horizon Seven West Media is expected to generate 2.27 times more return on investment than GRIFFIN MINING. However, Seven West is 2.27 times more volatile than GRIFFIN MINING LTD. It trades about 0.01 of its potential returns per unit of risk. GRIFFIN MINING LTD is currently generating about 0.0 per unit of risk. If you would invest 10.00 in Seven West Media on October 30, 2024 and sell it today you would lose (1.35) from holding Seven West Media or give up 13.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Seven West Media vs. GRIFFIN MINING LTD
Performance |
| Timeline |
| Seven West Media |
| GRIFFIN MINING LTD |
Seven West and GRIFFIN MINING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Seven West and GRIFFIN MINING
The main advantage of trading using opposite Seven West and GRIFFIN MINING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seven West 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.| Seven West vs. BOSTON BEER A | Seven West vs. WIMFARM SA EO | Seven West vs. Tokyu Construction Co | Seven West vs. United Breweries Co |
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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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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