Correlation Between Graham and Mirion Technologies

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

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

Diversification Opportunities for Graham and Mirion Technologies

0.71

Correlation Coefficient

Graham  Mirion Technologies

Poor diversification

The 3 months correlation between Graham and Mirion is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Graham and Mirion Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mirion Technologies and Graham 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 Graham are associated (or correlated) with Mirion Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mirion Technologies has no effect on the direction of Graham i.e., Graham and Mirion Technologies go up and down completely randomly.

Pair Corralation between Graham and Mirion Technologies

Considering the 90-day investment horizon Graham is expected to under-perform the Mirion Technologies. In addition to that, Graham is 1.12 times more volatile than Mirion Technologies. It trades about -0.12 of its total potential returns per unit of risk. Mirion Technologies is currently generating about -0.06 per unit of volatility. If you would invest  1,810  in Mirion Technologies on December 25, 2024 and sell it today you would lose (264.00) from holding Mirion Technologies or give up 14.59% of portfolio value over 90 days.

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

Graham  vs.  Mirion Technologies

Graham

Risk-Adjusted Performance

Very Weak

Over the last 90 days Graham 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 technical indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Mirion Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Mirion Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's forward indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Graham and Mirion Technologies

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

The idea behind Graham and Mirion Technologies 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.