Correlation Between Gran Tierra and Blue Apron

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

By analyzing existing cross correlation between Gran Tierra Energy and Blue Apron Holdings, you can compare the effects of market volatilities on Gran Tierra and Blue Apron 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 Gran Tierra with a short position of Blue Apron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gran Tierra and Blue Apron.

Diversification Opportunities for Gran Tierra and Blue Apron

0.77

Correlation Coefficient

Gran Tierra  Blue Apron

Poor diversification

The 3 months correlation between Gran and Blue is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Gran Tierra Energy and Blue Apron Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blue Apron Holdings and Gran Tierra 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 Gran Tierra Energy are associated (or correlated) with Blue Apron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blue Apron Holdings has no effect on the direction of Gran Tierra i.e., Gran Tierra and Blue Apron go up and down completely randomly.

Pair Corralation between Gran Tierra and Blue Apron

If you would invest  656.00  in Gran Tierra Energy on January 20, 2024 and sell it today you would earn a total of  143.00  from holding Gran Tierra Energy or generate 21.8% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	4.55%
Values	Daily Returns

Gran Tierra Energy  vs.  Blue Apron Holdings

Gran Tierra Energy

Risk-Adjusted Performance

21 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Gran Tierra Energy are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Gran Tierra exhibited solid returns over the last few months and may actually be approaching a breakup point.

Blue Apron Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Blue Apron Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Blue Apron is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Gran Tierra and Blue Apron

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

The idea behind Gran Tierra Energy and Blue Apron Holdings 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.