Correlation Between Granite Construction and CI GAMES

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

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

Diversification Opportunities for Granite Construction and CI GAMES

0.86

Correlation Coefficient

Granite Construction  CI GAMES

Very poor diversification

The 3 months correlation between Granite and CI7 is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Granite Construction and CI GAMES SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI GAMES SA and Granite Construction 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 Granite Construction are associated (or correlated) with CI GAMES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI GAMES SA has no effect on the direction of Granite Construction i.e., Granite Construction and CI GAMES go up and down completely randomly.

Pair Corralation between Granite Construction and CI GAMES

Assuming the 90 days trading horizon Granite Construction is expected to generate 0.44 times more return on investment than CI GAMES. However, Granite Construction is 2.29 times less risky than CI GAMES. It trades about 0.09 of its potential returns per unit of risk. CI GAMES SA is currently generating about -0.01 per unit of risk. If you would invest  3,564  in Granite Construction on April 20, 2025 and sell it today you would earn a total of  4,436  from holding Granite Construction or generate 124.47% return on investment over 90 days.

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

Granite Construction  vs.  CI GAMES SA

Granite Construction

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Granite Construction are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Granite Construction unveiled solid returns over the last few months and may actually be approaching a breakup point.

CI GAMES SA

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in CI GAMES SA are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, CI GAMES reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Granite Construction and CI GAMES

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

The idea behind Granite Construction and CI GAMES SA 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.