Correlation Between Greystone Logistics and CN Energy

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

By analyzing existing cross correlation between Greystone Logistics and CN Energy Group, you can compare the effects of market volatilities on Greystone Logistics and CN Energy 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 Greystone Logistics with a short position of CN Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greystone Logistics and CN Energy.

Diversification Opportunities for Greystone Logistics and CN Energy

0.54

Correlation Coefficient

Greystone Logistics  CN Energy

Very weak diversification

The 3 months correlation between Greystone and CNEY is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Greystone Logistics and CN Energy Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CN Energy Group and Greystone Logistics 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 Greystone Logistics are associated (or correlated) with CN Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CN Energy Group has no effect on the direction of Greystone Logistics i.e., Greystone Logistics and CN Energy go up and down completely randomly.

Pair Corralation between Greystone Logistics and CN Energy

Given the investment horizon of 90 days Greystone Logistics is expected to under-perform the CN Energy. But the otc stock apears to be less risky and, when comparing its historical volatility, Greystone Logistics is 3.54 times less risky than CN Energy. The otc stock trades about -0.09 of its potential returns per unit of risk. The CN Energy Group is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  45.00  in CN Energy Group on September 13, 2024 and sell it today you would lose (11.00) from holding CN Energy Group or give up 24.44% of portfolio value over 90 days.

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

Greystone Logistics  vs.  CN Energy Group

Greystone Logistics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Greystone Logistics has generated negative risk-adjusted returns adding no value to investors with long positions. Despite abnormal performance in the last few months, the Stock's technical and fundamental indicators remain fairly strong which may send shares a bit higher in January 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

CN Energy Group

Risk-Adjusted Performance

2 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in CN Energy Group are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak technical and fundamental indicators, CN Energy showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Greystone Logistics and CN Energy

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

The idea behind Greystone Logistics and CN Energy Group 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.