Correlation Between GE Vernova and Nebius Group

Can any of the company-specific risk be diversified away by investing in both GE Vernova and Nebius Group 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 Nebius Group 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 Nebius Group NV, you can compare the effects of market volatilities on GE Vernova and Nebius Group 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 Nebius Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Vernova and Nebius Group.

Diversification Opportunities for GE Vernova and Nebius Group

0.66

Correlation Coefficient

GE Vernova  Nebius Group

Poor diversification

The 3 months correlation between GEV and Nebius is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding GE Vernova LLC and Nebius Group NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nebius Group NV 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 Nebius Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nebius Group NV has no effect on the direction of GE Vernova i.e., GE Vernova and Nebius Group go up and down completely randomly.

Pair Corralation between GE Vernova and Nebius Group

Considering the 90-day investment horizon GE Vernova is expected to generate 4.22 times less return on investment than Nebius Group. But when comparing it to its historical volatility, GE Vernova LLC is 1.79 times less risky than Nebius Group. It trades about 0.02 of its potential returns per unit of risk. Nebius Group NV is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  2,806  in Nebius Group NV on December 26, 2024 and sell it today you would lose (89.00) from holding Nebius Group NV or give up 3.17% of portfolio value over 90 days.

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

GE Vernova LLC  vs.  Nebius Group NV

GE Vernova LLC

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in GE Vernova LLC are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable technical and fundamental indicators, GE Vernova is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Nebius Group NV

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Nebius Group NV are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating forward indicators, Nebius Group unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GE Vernova and Nebius Group

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

The idea behind GE Vernova LLC and Nebius Group NV 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.