Correlation Between GRIFFIN MINING and Asahi Group

Can any of the company-specific risk be diversified away by investing in both GRIFFIN MINING and Asahi Group 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 Asahi Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GRIFFIN MINING LTD and Asahi Group Holdings, you can compare the effects of market volatilities on GRIFFIN MINING and Asahi Group 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 Asahi Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of GRIFFIN MINING and Asahi Group.

Diversification Opportunities for GRIFFIN MINING and Asahi Group

0.85

Correlation Coefficient

GRIFFIN MINING  Asahi Group

Very poor diversification

The 3 months correlation between GRIFFIN and Asahi is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding GRIFFIN MINING LTD and Asahi Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asahi Group Holdings 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 LTD are associated (or correlated) with Asahi Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asahi Group Holdings has no effect on the direction of GRIFFIN MINING i.e., GRIFFIN MINING and Asahi Group go up and down completely randomly.

Pair Corralation between GRIFFIN MINING and Asahi Group

Assuming the 90 days horizon GRIFFIN MINING LTD is expected to generate 1.43 times more return on investment than Asahi Group. However, GRIFFIN MINING is 1.43 times more volatile than Asahi Group Holdings. It trades about 0.16 of its potential returns per unit of risk. Asahi Group Holdings is currently generating about 0.14 per unit of risk. If you would invest  171.00  in GRIFFIN MINING LTD on December 26, 2024 and sell it today you would earn a total of  47.00  from holding GRIFFIN MINING LTD or generate 27.49% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	98.39%
Values	Daily Returns

GRIFFIN MINING LTD  vs.  Asahi Group Holdings

GRIFFIN MINING LTD

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in GRIFFIN MINING LTD are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, GRIFFIN MINING reported solid returns over the last few months and may actually be approaching a breakup point.

Asahi Group Holdings

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Asahi Group Holdings are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Asahi Group reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GRIFFIN MINING and Asahi Group

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

The idea behind GRIFFIN MINING LTD and Asahi Group 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.