Correlation Between Western Copper and Griffon
Can any of the company-specific risk be diversified away by investing in both Western Copper 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 Western Copper and Griffon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Copper and and Griffon, you can compare the effects of market volatilities on Western Copper 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 Western Copper with a short position of Griffon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Copper and Griffon.
Diversification Opportunities for Western Copper and Griffon
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Western and Griffon is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Western Copper and and Griffon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Griffon and Western Copper 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 Western Copper and 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 Western Copper i.e., Western Copper and Griffon go up and down completely randomly.
Pair Corralation between Western Copper and Griffon
Considering the 90-day investment horizon Western Copper and is expected to generate 1.36 times more return on investment than Griffon. However, Western Copper is 1.36 times more volatile than Griffon. It trades about -0.18 of its potential returns per unit of risk. Griffon is currently generating about -0.36 per unit of risk. If you would invest 114.00 in Western Copper and on September 23, 2024 and sell it today you would lose (10.00) from holding Western Copper and or give up 8.77% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Western Copper and vs. Griffon
Performance |
Timeline |
Western Copper |
Griffon |
Western Copper and Griffon Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Western Copper and Griffon
The main advantage of trading using opposite Western Copper and Griffon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Copper 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.Western Copper vs. Fury Gold Mines | Western Copper vs. EMX Royalty Corp | Western Copper vs. Nevada King Gold | Western Copper vs. Aftermath Silver |
Griffon vs. Brookfield Business Partners | Griffon vs. Tejon Ranch Co | Griffon vs. Compass Diversified Holdings | Griffon vs. Steel Partners Holdings |
Check out your portfolio center.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 Stocks Directory module to find actively traded stocks across global markets.
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