Correlation Between Griffon and Helmerich

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

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

Diversification Opportunities for Griffon and Helmerich

0.34

Correlation Coefficient

Griffon  Helmerich

Weak diversification

The 3 months correlation between Griffon and Helmerich is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Griffon and Helmerich and Payne in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Helmerich and Payne and Griffon 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 Griffon are associated (or correlated) with Helmerich. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Helmerich and Payne has no effect on the direction of Griffon i.e., Griffon and Helmerich go up and down completely randomly.

Pair Corralation between Griffon and Helmerich

Considering the 90-day investment horizon Griffon is expected to under-perform the Helmerich. In addition to that, Griffon is 1.33 times more volatile than Helmerich and Payne. It trades about -0.01 of its total potential returns per unit of risk. Helmerich and Payne is currently generating about 0.0 per unit of volatility. If you would invest  3,758  in Helmerich and Payne on February 25, 2024 and sell it today you would lose (43.00) from holding Helmerich and Payne or give up 1.14% of portfolio value over 90 days.

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

Griffon  vs.  Helmerich and Payne

Griffon

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Griffon has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, Griffon is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Helmerich and Payne

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Helmerich and Payne has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Helmerich is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Griffon and Helmerich

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

The idea behind Griffon and Helmerich and Payne 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.