Correlation Between Griffin Mining and Ajax Resources

Can any of the company-specific risk be diversified away by investing in both Griffin Mining and Ajax Resources 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 Griffin Mining and Ajax Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Griffin Mining and Ajax Resources PLC, you can compare the effects of market volatilities on Griffin Mining and Ajax Resources 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 Griffin Mining with a short position of Ajax Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Griffin Mining and Ajax Resources.

Diversification Opportunities for Griffin Mining and Ajax Resources

0.0

Correlation Coefficient

Griffin Mining  Ajax Resources

Pay attention - limited upside

The 3 months correlation between Griffin and Ajax is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Griffin Mining and Ajax Resources PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ajax Resources PLC and Griffin Mining 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 Griffin Mining are associated (or correlated) with Ajax Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ajax Resources PLC has no effect on the direction of Griffin Mining i.e., Griffin Mining and Ajax Resources go up and down completely randomly.

Pair Corralation between Griffin Mining and Ajax Resources

If you would invest  14,600  in Griffin Mining on December 22, 2024 and sell it today you would earn a total of  3,700  from holding Griffin Mining or generate 25.34% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

Griffin Mining  vs.  Ajax Resources PLC

Griffin Mining

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Griffin Mining are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Griffin Mining exhibited solid returns over the last few months and may actually be approaching a breakup point.

Ajax Resources PLC

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ajax Resources PLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Ajax Resources is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Griffin Mining and Ajax Resources

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

The idea behind Griffin Mining and Ajax Resources PLC 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.

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 Equity Valuation module to check real value of public entities based on technical and fundamental data.