Correlation Between Monitor Ventures and Granite Creek

Can any of the company-specific risk be diversified away by investing in both Monitor Ventures and Granite Creek 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 Monitor Ventures and Granite Creek into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Monitor Ventures and Granite Creek Copper, you can compare the effects of market volatilities on Monitor Ventures and Granite Creek 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 Monitor Ventures with a short position of Granite Creek. Check out your portfolio center. Please also check ongoing floating volatility patterns of Monitor Ventures and Granite Creek.

Diversification Opportunities for Monitor Ventures and Granite Creek

-0.2

Correlation Coefficient

Monitor Ventures  Granite Creek

Good diversification

The 3 months correlation between Monitor and Granite is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Monitor Ventures and Granite Creek Copper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Granite Creek Copper and Monitor Ventures 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 Monitor Ventures are associated (or correlated) with Granite Creek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Granite Creek Copper has no effect on the direction of Monitor Ventures i.e., Monitor Ventures and Granite Creek go up and down completely randomly.

Pair Corralation between Monitor Ventures and Granite Creek

Assuming the 90 days horizon Monitor Ventures is expected to generate 0.12 times more return on investment than Granite Creek. However, Monitor Ventures is 8.58 times less risky than Granite Creek. It trades about 0.2 of its potential returns per unit of risk. Granite Creek Copper is currently generating about 0.0 per unit of risk. If you would invest  7.93  in Monitor Ventures on September 4, 2024 and sell it today you would earn a total of  1.07  from holding Monitor Ventures or generate 13.49% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Monitor Ventures  vs.  Granite Creek Copper

Monitor Ventures

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Monitor Ventures are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, Monitor Ventures reported solid returns over the last few months and may actually be approaching a breakup point.

Granite Creek Copper

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Granite Creek Copper has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Granite Creek is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Monitor Ventures and Granite Creek

The main advantage of trading using opposite Monitor Ventures and Granite Creek positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Monitor Ventures position performs unexpectedly, Granite Creek 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 Creek will offset losses from the drop in Granite Creek's long position.

The idea behind Monitor Ventures and Granite Creek Copper pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.