Correlation Between Canada Goose and Griffon

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

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

Diversification Opportunities for Canada Goose and Griffon

-0.39

Correlation Coefficient

Canada Goose  Griffon

Very good diversification

The 3 months correlation between Canada and Griffon is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Canada Goose Holdings and Griffon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Griffon and Canada Goose 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 Canada Goose Holdings are associated (or correlated) with Griffon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Griffon has no effect on the direction of Canada Goose i.e., Canada Goose and Griffon go up and down completely randomly.

Pair Corralation between Canada Goose and Griffon

Given the investment horizon of 90 days Canada Goose Holdings is expected to generate 1.61 times more return on investment than Griffon. However, Canada Goose is 1.61 times more volatile than Griffon. It trades about 0.01 of its potential returns per unit of risk. Griffon is currently generating about -0.13 per unit of risk. If you would invest  974.00  in Canada Goose Holdings on December 3, 2024 and sell it today you would lose (2.00) from holding Canada Goose Holdings or give up 0.21% of portfolio value over 90 days.

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

Canada Goose Holdings  vs.  Griffon

Canada Goose Holdings

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Canada Goose Holdings are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Canada Goose is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Griffon

Risk-Adjusted Performance

Very Weak

Over the last 90 days Griffon has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical and fundamental indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Canada Goose and Griffon

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

The idea behind Canada Goose Holdings and Griffon 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.