Correlation Between GM and Aam/bahl Gaynor
Can any of the company-specific risk be diversified away by investing in both GM and Aam/bahl Gaynor 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 GM and Aam/bahl Gaynor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and Aambahl Gaynor Income, you can compare the effects of market volatilities on GM and Aam/bahl Gaynor 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 GM with a short position of Aam/bahl Gaynor. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Aam/bahl Gaynor.
Diversification Opportunities for GM and Aam/bahl Gaynor
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GM and Aam/bahl is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Aambahl Gaynor Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aambahl Gaynor Income and GM 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 General Motors are associated (or correlated) with Aam/bahl Gaynor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aambahl Gaynor Income has no effect on the direction of GM i.e., GM and Aam/bahl Gaynor go up and down completely randomly.
Pair Corralation between GM and Aam/bahl Gaynor
Allowing for the 90-day total investment horizon General Motors is expected to under-perform the Aam/bahl Gaynor. In addition to that, GM is 3.46 times more volatile than Aambahl Gaynor Income. It trades about -0.01 of its total potential returns per unit of risk. Aambahl Gaynor Income is currently generating about -0.01 per unit of volatility. If you would invest 2,509 in Aambahl Gaynor Income on December 26, 2024 and sell it today you would lose (12.00) from holding Aambahl Gaynor Income or give up 0.48% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
General Motors vs. Aambahl Gaynor Income
Performance |
Timeline |
General Motors |
Aambahl Gaynor Income |
GM and Aam/bahl Gaynor Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with GM and Aam/bahl Gaynor
The main advantage of trading using opposite GM and Aam/bahl Gaynor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Aam/bahl Gaynor 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 Aam/bahl Gaynor will offset losses from the drop in Aam/bahl Gaynor's long position.The idea behind General Motors and Aambahl Gaynor Income 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.Aam/bahl Gaynor vs. Ashmore Emerging Markets | Aam/bahl Gaynor vs. Siit Small Cap | Aam/bahl Gaynor vs. Nt International Small Mid | Aam/bahl Gaynor vs. Federated Clover Small |
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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
Money Managers Screen money managers from public funds and ETFs managed around the world | |
Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
Content Syndication Quickly integrate customizable finance content to your own investment portal | |
Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |