Correlation Between GM and 654106AH6
Specify exactly 2 symbols:
By analyzing existing cross correlation between General Motors and NIKE INC, you can compare the effects of market volatilities on GM and 654106AH6 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 654106AH6. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and 654106AH6.
Diversification Opportunities for GM and 654106AH6
Good diversification
The 3 months correlation between GM and 654106AH6 is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and NIKE INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 654106AH6 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 654106AH6. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 654106AH6 has no effect on the direction of GM i.e., GM and 654106AH6 go up and down completely randomly.
Pair Corralation between GM and 654106AH6
Allowing for the 90-day total investment horizon General Motors is expected to generate 5.56 times more return on investment than 654106AH6. However, GM is 5.56 times more volatile than NIKE INC. It trades about 0.06 of its potential returns per unit of risk. NIKE INC is currently generating about -0.11 per unit of risk. If you would invest 4,855 in General Motors on September 18, 2024 and sell it today you would earn a total of 369.00 from holding General Motors or generate 7.6% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 98.41% |
Values | Daily Returns |
General Motors vs. NIKE INC
Performance |
Timeline |
General Motors |
654106AH6 |
GM and 654106AH6 Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with GM and 654106AH6
The main advantage of trading using opposite GM and 654106AH6 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, 654106AH6 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 654106AH6 will offset losses from the drop in 654106AH6's long position.The idea behind General Motors and NIKE INC 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.654106AH6 vs. Mayfair Gold Corp | 654106AH6 vs. Mesa Air Group | 654106AH6 vs. Old Dominion Freight | 654106AH6 vs. Ryanair Holdings PLC |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |