Correlation Between GE Vernova and Coeur DAlene

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

By analyzing existing cross correlation between GE Vernova LLC and Coeur dAlene Bancorp, you can compare the effects of market volatilities on GE Vernova and Coeur DAlene 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 GE Vernova with a short position of Coeur DAlene. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Vernova and Coeur DAlene.

Diversification Opportunities for GE Vernova and Coeur DAlene

0.87

Correlation Coefficient

GE Vernova  Coeur DAlene

Very poor diversification

The 3 months correlation between GEV and Coeur is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding GE Vernova LLC and Coeur dAlene Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coeur dAlene Bancorp and GE Vernova 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 GE Vernova LLC are associated (or correlated) with Coeur DAlene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coeur dAlene Bancorp has no effect on the direction of GE Vernova i.e., GE Vernova and Coeur DAlene go up and down completely randomly.

Pair Corralation between GE Vernova and Coeur DAlene

Considering the 90-day investment horizon GE Vernova LLC is expected to generate 0.79 times more return on investment than Coeur DAlene. However, GE Vernova LLC is 1.26 times less risky than Coeur DAlene. It trades about 0.26 of its potential returns per unit of risk. Coeur dAlene Bancorp is currently generating about 0.15 per unit of risk. If you would invest  28,901  in GE Vernova LLC on October 26, 2024 and sell it today you would earn a total of  14,870  from holding GE Vernova LLC or generate 51.45% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	93.65%
Values	Daily Returns

GE Vernova LLC  vs.  Coeur dAlene Bancorp

GE Vernova LLC

Risk-Adjusted Performance

20 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in GE Vernova LLC are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain technical and fundamental indicators, GE Vernova showed solid returns over the last few months and may actually be approaching a breakup point.

Coeur dAlene Bancorp

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Coeur dAlene Bancorp are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat inconsistent basic indicators, Coeur DAlene sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GE Vernova and Coeur DAlene

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

The idea behind GE Vernova LLC and Coeur dAlene Bancorp 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.

Check out your portfolio center.

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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.