Correlation Between GraniteShares 15x and EA Series

Can any of the company-specific risk be diversified away by investing in both GraniteShares 15x and EA Series 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 GraniteShares 15x and EA Series into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GraniteShares 15x Long and EA Series Trust, you can compare the effects of market volatilities on GraniteShares 15x and EA Series 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 GraniteShares 15x with a short position of EA Series. Check out your portfolio center. Please also check ongoing floating volatility patterns of GraniteShares 15x and EA Series.

Diversification Opportunities for GraniteShares 15x and EA Series

0.78

Correlation Coefficient

GraniteShares 15x  EA Series

Poor diversification

The 3 months correlation between GraniteShares and STRV is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding GraniteShares 15x Long and EA Series Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EA Series Trust and GraniteShares 15x 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 GraniteShares 15x Long are associated (or correlated) with EA Series. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EA Series Trust has no effect on the direction of GraniteShares 15x i.e., GraniteShares 15x and EA Series go up and down completely randomly.

Pair Corralation between GraniteShares 15x and EA Series

Given the investment horizon of 90 days GraniteShares 15x Long is expected to under-perform the EA Series. In addition to that, GraniteShares 15x is 6.81 times more volatile than EA Series Trust. It trades about -0.02 of its total potential returns per unit of risk. EA Series Trust is currently generating about 0.12 per unit of volatility. If you would invest  3,760  in EA Series Trust on September 12, 2024 and sell it today you would earn a total of  132.00  from holding EA Series Trust or generate 3.51% return on investment over 90 days.

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

GraniteShares 15x Long  vs.  EA Series Trust

GraniteShares 15x Long

Risk-Adjusted Performance

6 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in GraniteShares 15x Long are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite quite uncertain fundamental indicators, GraniteShares 15x disclosed solid returns over the last few months and may actually be approaching a breakup point.

EA Series Trust

Risk-Adjusted Performance

15 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in EA Series Trust are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of fairly conflicting basic indicators, EA Series may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with GraniteShares 15x and EA Series

The main advantage of trading using opposite GraniteShares 15x and EA Series positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GraniteShares 15x position performs unexpectedly, EA Series 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 EA Series will offset losses from the drop in EA Series' long position.

The idea behind GraniteShares 15x Long and EA Series Trust 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.