Correlation Between Verizon Communications and GraniteShares 125x

Can any of the company-specific risk be diversified away by investing in both Verizon Communications and GraniteShares 125x 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 Verizon Communications and GraniteShares 125x into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Verizon Communications and GraniteShares 125x Long, you can compare the effects of market volatilities on Verizon Communications and GraniteShares 125x 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 Verizon Communications with a short position of GraniteShares 125x. Check out your portfolio center. Please also check ongoing floating volatility patterns of Verizon Communications and GraniteShares 125x.

Diversification Opportunities for Verizon Communications and GraniteShares 125x

-0.4

Correlation Coefficient

Verizon Communications  GraniteShares 125x

Very good diversification

The 3 months correlation between Verizon and GraniteShares is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Verizon Communications and GraniteShares 125x Long in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GraniteShares 125x Long and Verizon Communications 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 Verizon Communications are associated (or correlated) with GraniteShares 125x. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GraniteShares 125x Long has no effect on the direction of Verizon Communications i.e., Verizon Communications and GraniteShares 125x go up and down completely randomly.

Pair Corralation between Verizon Communications and GraniteShares 125x

Allowing for the 90-day total investment horizon Verizon Communications is expected to generate 60.59 times less return on investment than GraniteShares 125x. But when comparing it to its historical volatility, Verizon Communications is 4.09 times less risky than GraniteShares 125x. It trades about 0.01 of its potential returns per unit of risk. GraniteShares 125x Long is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  709.00  in GraniteShares 125x Long on September 21, 2024 and sell it today you would earn a total of  1,305  from holding GraniteShares 125x Long or generate 184.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	99.21%
Values	Daily Returns

Verizon Communications  vs.  GraniteShares 125x Long

Verizon Communications

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Verizon Communications has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

GraniteShares 125x Long

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in GraniteShares 125x Long are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, GraniteShares 125x disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Verizon Communications and GraniteShares 125x

The main advantage of trading using opposite Verizon Communications and GraniteShares 125x positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Verizon Communications position performs unexpectedly, GraniteShares 125x 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 GraniteShares 125x will offset losses from the drop in GraniteShares 125x's long position.

The idea behind Verizon Communications and GraniteShares 125x Long 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.