Correlation Between GraniteShares and Edinburgh Worldwide

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

By analyzing existing cross correlation between GraniteShares 3x Short and Edinburgh Worldwide Investment, you can compare the effects of market volatilities on GraniteShares and Edinburgh Worldwide 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 with a short position of Edinburgh Worldwide. Check out your portfolio center. Please also check ongoing floating volatility patterns of GraniteShares and Edinburgh Worldwide.

Diversification Opportunities for GraniteShares and Edinburgh Worldwide

-0.83

Correlation Coefficient

GraniteShares  Edinburgh Worldwide

Pay attention - limited upside

The 3 months correlation between GraniteShares and Edinburgh is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding GraniteShares 3x Short and Edinburgh Worldwide Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Edinburgh Worldwide and GraniteShares 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 3x Short are associated (or correlated) with Edinburgh Worldwide. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Edinburgh Worldwide has no effect on the direction of GraniteShares i.e., GraniteShares and Edinburgh Worldwide go up and down completely randomly.

Pair Corralation between GraniteShares and Edinburgh Worldwide

Assuming the 90 days trading horizon GraniteShares 3x Short is expected to under-perform the Edinburgh Worldwide. In addition to that, GraniteShares is 9.39 times more volatile than Edinburgh Worldwide Investment. It trades about -0.26 of its total potential returns per unit of risk. Edinburgh Worldwide Investment is currently generating about 0.36 per unit of volatility. If you would invest  14,780  in Edinburgh Worldwide Investment on September 14, 2024 and sell it today you would earn a total of  5,020  from holding Edinburgh Worldwide Investment or generate 33.96% return on investment over 90 days.

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

GraniteShares 3x Short  vs.  Edinburgh Worldwide Investment

GraniteShares 3x Short

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GraniteShares 3x Short has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Etf's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the exchange-traded fund private investors.

Edinburgh Worldwide

Risk-Adjusted Performance

28 of 100

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Edinburgh Worldwide Investment are ranked lower than 28 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Edinburgh Worldwide exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GraniteShares and Edinburgh Worldwide

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

The idea behind GraniteShares 3x Short and Edinburgh Worldwide Investment 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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.