Correlation Between GraniteShares Platinum and Abrdn Physical

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

By analyzing existing cross correlation between GraniteShares Platinum Trust and abrdn Physical Platinum, you can compare the effects of market volatilities on GraniteShares Platinum and Abrdn Physical 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 GraniteShares Platinum with a short position of Abrdn Physical. Check out your portfolio center. Please also check ongoing floating volatility patterns of GraniteShares Platinum and Abrdn Physical.

Diversification Opportunities for GraniteShares Platinum and Abrdn Physical

0.87

Correlation Coefficient

GraniteShares Platinum  Abrdn Physical

Very poor diversification

The 3 months correlation between GraniteShares and Abrdn is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding GraniteShares Platinum Trust and abrdn Physical Platinum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on abrdn Physical Platinum and GraniteShares Platinum 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 GraniteShares Platinum Trust are associated (or correlated) with Abrdn Physical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of abrdn Physical Platinum has no effect on the direction of GraniteShares Platinum i.e., GraniteShares Platinum and Abrdn Physical go up and down completely randomly.

Pair Corralation between GraniteShares Platinum and Abrdn Physical

Given the investment horizon of 90 days GraniteShares Platinum is expected to generate 1.27 times less return on investment than Abrdn Physical. In addition to that, GraniteShares Platinum is 1.0 times more volatile than abrdn Physical Platinum. It trades about 0.0 of its total potential returns per unit of risk. abrdn Physical Platinum is currently generating about 0.0 per unit of volatility. If you would invest  8,866  in abrdn Physical Platinum on December 4, 2024 and sell it today you would lose (148.00) from holding abrdn Physical Platinum or give up 1.67% of portfolio value over 90 days.

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

GraniteShares Platinum Trust  vs.  abrdn Physical Platinum

GraniteShares Platinum

Risk-Adjusted Performance

Very Weak

Over the last 90 days GraniteShares Platinum Trust has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, GraniteShares Platinum is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

abrdn Physical Platinum

Risk-Adjusted Performance

Weak

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

Pair Trading with GraniteShares Platinum and Abrdn Physical

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

The idea behind GraniteShares Platinum Trust and abrdn Physical Platinum 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.