Correlation Between National Health and GRIFFIN MINING
Can any of the company-specific risk be diversified away by investing in both National Health 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 National Health and GRIFFIN MINING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Health Investors and GRIFFIN MINING LTD, you can compare the effects of market volatilities on National Health 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 National Health with a short position of GRIFFIN MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Health and GRIFFIN MINING.
Diversification Opportunities for National Health and GRIFFIN MINING
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between National and GRIFFIN is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding National Health Investors 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 National Health 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 National Health Investors 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 National Health i.e., National Health and GRIFFIN MINING go up and down completely randomly.
Pair Corralation between National Health and GRIFFIN MINING
Assuming the 90 days trading horizon National Health is expected to generate 1.6 times less return on investment than GRIFFIN MINING. But when comparing it to its historical volatility, National Health Investors is 1.28 times less risky than GRIFFIN MINING. It trades about 0.09 of its potential returns per unit of risk. GRIFFIN MINING LTD is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 88.00 in GRIFFIN MINING LTD on September 12, 2024 and sell it today you would earn a total of 88.00 from holding GRIFFIN MINING LTD or generate 100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Health Investors vs. GRIFFIN MINING LTD
Performance |
| Timeline |
| National Health Investors |
| GRIFFIN MINING LTD |
National Health and GRIFFIN MINING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Health and GRIFFIN MINING
The main advantage of trading using opposite National Health and GRIFFIN MINING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Health 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.| National Health vs. COSTCO WHOLESALE CDR | National Health vs. Titan Machinery | National Health vs. ALEFARM BREWING DK 05 | National Health vs. MARKET VECTR RETAIL |
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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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