Correlation Between Endeavour Mining and Griffin Mining

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

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

Diversification Opportunities for Endeavour Mining and Griffin Mining

0.59

Correlation Coefficient

Endeavour Mining  Griffin Mining

Very weak diversification

The 3 months correlation between Endeavour and Griffin is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Endeavour Mining Corp and Griffin Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Griffin Mining and Endeavour Mining 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 Endeavour Mining Corp are associated (or correlated) with Griffin Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Griffin Mining has no effect on the direction of Endeavour Mining i.e., Endeavour Mining and Griffin Mining go up and down completely randomly.

Pair Corralation between Endeavour Mining and Griffin Mining

Assuming the 90 days trading horizon Endeavour Mining Corp is expected to under-perform the Griffin Mining. But the stock apears to be less risky and, when comparing its historical volatility, Endeavour Mining Corp is 1.06 times less risky than Griffin Mining. The stock trades about -0.26 of its potential returns per unit of risk. The Griffin Mining is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest  15,000  in Griffin Mining on September 25, 2024 and sell it today you would lose (400.00) from holding Griffin Mining or give up 2.67% of portfolio value over 90 days.

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

Endeavour Mining Corp  vs.  Griffin Mining

Endeavour Mining Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Endeavour Mining Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Griffin Mining

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Griffin Mining has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Griffin Mining is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Endeavour Mining and Griffin Mining

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

The idea behind Endeavour Mining Corp and Griffin Mining 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.