Correlation Between Greif Bros and Eightco Holdings

Can any of the company-specific risk be diversified away by investing in both Greif Bros and Eightco Holdings 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 Greif Bros and Eightco Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Greif Bros and Eightco Holdings, you can compare the effects of market volatilities on Greif Bros and Eightco Holdings 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 Greif Bros with a short position of Eightco Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greif Bros and Eightco Holdings.

Diversification Opportunities for Greif Bros and Eightco Holdings

-0.42

Correlation Coefficient

Greif Bros  Eightco Holdings

Very good diversification

The 3 months correlation between Greif and Eightco is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Greif Bros and Eightco Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eightco Holdings and Greif Bros 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 Greif Bros are associated (or correlated) with Eightco Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eightco Holdings has no effect on the direction of Greif Bros i.e., Greif Bros and Eightco Holdings go up and down completely randomly.

Pair Corralation between Greif Bros and Eightco Holdings

Considering the 90-day investment horizon Greif Bros is expected to under-perform the Eightco Holdings. But the stock apears to be less risky and, when comparing its historical volatility, Greif Bros is 2.56 times less risky than Eightco Holdings. The stock trades about -0.4 of its potential returns per unit of risk. The Eightco Holdings is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest  162.00  in Eightco Holdings on September 22, 2024 and sell it today you would lose (15.00) from holding Eightco Holdings or give up 9.26% of portfolio value over 90 days.

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

Greif Bros  vs.  Eightco Holdings

Greif Bros

Risk-Adjusted Performance

0 of 100

Very Weak

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

Eightco Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Eightco Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Greif Bros and Eightco Holdings

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

The idea behind Greif Bros and Eightco Holdings 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.