Correlation Between GRIN and VTC

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

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

Diversification Opportunities for GRIN and VTC

-0.29

Correlation Coefficient

GRIN  VTC

Very good diversification

The 3 months correlation between GRIN and VTC is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding GRIN and VTC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VTC and GRIN 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 GRIN are associated (or correlated) with VTC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VTC has no effect on the direction of GRIN i.e., GRIN and VTC go up and down completely randomly.

Pair Corralation between GRIN and VTC

Assuming the 90 days trading horizon GRIN is expected to generate 3.47 times more return on investment than VTC. However, GRIN is 3.47 times more volatile than VTC. It trades about 0.19 of its potential returns per unit of risk. VTC is currently generating about -0.01 per unit of risk. If you would invest  1.66  in GRIN on May 16, 2025 and sell it today you would earn a total of  3.05  from holding GRIN or generate 183.73% return on investment over 90 days.

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

GRIN  vs.  VTC

GRIN

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in GRIN are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, GRIN exhibited solid returns over the last few months and may actually be approaching a breakup point.

VTC

Risk-Adjusted Performance

Weakest

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

Pair Trading with GRIN and VTC

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

The idea behind GRIN and VTC 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.