Correlation Between GM and Altegrisaaca Opportunistic

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

By analyzing existing cross correlation between General Motors and Altegrisaaca Opportunistic Real, you can compare the effects of market volatilities on GM and Altegrisaaca Opportunistic 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 Altegrisaaca Opportunistic. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Altegrisaaca Opportunistic.

Diversification Opportunities for GM and Altegrisaaca Opportunistic

-0.26

Correlation Coefficient

GM  Altegrisaaca Opportunistic

Very good diversification

The 3 months correlation between GM and Altegrisaaca is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Altegrisaaca Opportunistic Rea in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altegrisaaca Opportunistic 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 Altegrisaaca Opportunistic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altegrisaaca Opportunistic has no effect on the direction of GM i.e., GM and Altegrisaaca Opportunistic go up and down completely randomly.

Pair Corralation between GM and Altegrisaaca Opportunistic

Allowing for the 90-day total investment horizon General Motors is expected to generate 1.62 times more return on investment than Altegrisaaca Opportunistic. However, GM is 1.62 times more volatile than Altegrisaaca Opportunistic Real. It trades about 0.06 of its potential returns per unit of risk. Altegrisaaca Opportunistic Real is currently generating about 0.04 per unit of risk. If you would invest  3,185  in General Motors on September 18, 2024 and sell it today you would earn a total of  2,039  from holding General Motors or generate 64.02% return on investment over 90 days.

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

General Motors  vs.  Altegrisaaca Opportunistic Rea

General Motors

Risk-Adjusted Performance

4 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in General Motors are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very weak primary indicators, GM may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Altegrisaaca Opportunistic

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Altegrisaaca Opportunistic Real has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Altegrisaaca Opportunistic is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with GM and Altegrisaaca Opportunistic

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

The idea behind General Motors and Altegrisaaca Opportunistic Real 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.