Correlation Between Brandywine Realty and Gryphon Digital

Can any of the company-specific risk be diversified away by investing in both Brandywine Realty and Gryphon Digital 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 Brandywine Realty and Gryphon Digital into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Brandywine Realty Trust and Gryphon Digital Mining, you can compare the effects of market volatilities on Brandywine Realty and Gryphon Digital 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 Brandywine Realty with a short position of Gryphon Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brandywine Realty and Gryphon Digital.

Diversification Opportunities for Brandywine Realty and Gryphon Digital

0.15

Correlation Coefficient

Brandywine Realty  Gryphon Digital

Average diversification

The 3 months correlation between Brandywine and Gryphon is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Brandywine Realty Trust and Gryphon Digital Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gryphon Digital Mining and Brandywine Realty 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 Brandywine Realty Trust are associated (or correlated) with Gryphon Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gryphon Digital Mining has no effect on the direction of Brandywine Realty i.e., Brandywine Realty and Gryphon Digital go up and down completely randomly.

Pair Corralation between Brandywine Realty and Gryphon Digital

Considering the 90-day investment horizon Brandywine Realty is expected to generate 3.91 times less return on investment than Gryphon Digital. But when comparing it to its historical volatility, Brandywine Realty Trust is 3.13 times less risky than Gryphon Digital. It trades about 0.05 of its potential returns per unit of risk. Gryphon Digital Mining is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  52.00  in Gryphon Digital Mining on September 14, 2024 and sell it today you would earn a total of  7.00  from holding Gryphon Digital Mining or generate 13.46% return on investment over 90 days.

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

Brandywine Realty Trust  vs.  Gryphon Digital Mining

Brandywine Realty Trust

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Brandywine Realty Trust are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very weak fundamental indicators, Brandywine Realty may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Gryphon Digital Mining

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Gryphon Digital Mining are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively fragile basic indicators, Gryphon Digital reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Brandywine Realty and Gryphon Digital

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

The idea behind Brandywine Realty Trust and Gryphon Digital Mining 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.