Correlation Between GE Vernova and 878742AS4

Can any of the company-specific risk be diversified away by investing in both GE Vernova and 878742AS4 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 878742AS4 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 Teck Resources 6, you can compare the effects of market volatilities on GE Vernova and 878742AS4 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 878742AS4. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Vernova and 878742AS4.

Diversification Opportunities for GE Vernova and 878742AS4

-0.15

Correlation Coefficient

GE Vernova  878742AS4

Good diversification

The 3 months correlation between GEV and 878742AS4 is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding GE Vernova LLC and Teck Resources 6 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Teck Resources 6 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 878742AS4. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Teck Resources 6 has no effect on the direction of GE Vernova i.e., GE Vernova and 878742AS4 go up and down completely randomly.

Pair Corralation between GE Vernova and 878742AS4

Considering the 90-day investment horizon GE Vernova LLC is expected to under-perform the 878742AS4. In addition to that, GE Vernova is 2.99 times more volatile than Teck Resources 6. It trades about -0.01 of its total potential returns per unit of risk. Teck Resources 6 is currently generating about 0.04 per unit of volatility. If you would invest  9,830  in Teck Resources 6 on December 28, 2024 and sell it today you would earn a total of  176.00  from holding Teck Resources 6 or generate 1.79% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	68.85%
Values	Daily Returns

GE Vernova LLC  vs.  Teck Resources 6

GE Vernova LLC

Risk-Adjusted Performance

Very Weak

Over the last 90 days GE Vernova LLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable technical and fundamental indicators, GE Vernova is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Teck Resources 6

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Teck Resources 6 are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, 878742AS4 is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with GE Vernova and 878742AS4

The main advantage of trading using opposite GE Vernova and 878742AS4 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GE Vernova position performs unexpectedly, 878742AS4 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 878742AS4 will offset losses from the drop in 878742AS4's long position.

The idea behind GE Vernova LLC and Teck Resources 6 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.