Correlation Between Greif and Greif Bros

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

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

Diversification Opportunities for Greif and Greif Bros

0.99

Correlation Coefficient

Greif  Greif Bros

No risk reduction

The 3 months correlation between Greif and Greif is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Greif Inc and Greif Bros in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greif Bros and Greif 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 Greif Inc are associated (or correlated) with Greif Bros. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greif Bros has no effect on the direction of Greif i.e., Greif and Greif Bros go up and down completely randomly.

Pair Corralation between Greif and Greif Bros

Assuming the 90 days horizon Greif is expected to generate 1.22 times less return on investment than Greif Bros. But when comparing it to its historical volatility, Greif Inc is 1.12 times less risky than Greif Bros. It trades about 0.1 of its potential returns per unit of risk. Greif Bros is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  5,387  in Greif Bros on May 2, 2025 and sell it today you would earn a total of  956.00  from holding Greif Bros or generate 17.75% return on investment over 90 days.

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

Greif Inc  vs.  Greif Bros

Greif Inc

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Greif Inc are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat fragile basic indicators, Greif sustained solid returns over the last few months and may actually be approaching a breakup point.

Greif Bros

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Greif Bros are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak technical and fundamental indicators, Greif Bros reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Greif and Greif Bros

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

The idea behind Greif Inc and Greif Bros 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 AI Portfolio Prophet module to use AI to generate optimal portfolios and find profitable investment opportunities.