Correlation Between Disney and GENERAL
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By analyzing existing cross correlation between Walt Disney and GENERAL ELEC 4125, you can compare the effects of market volatilities on Disney and GENERAL 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 Disney with a short position of GENERAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Disney and GENERAL.
Diversification Opportunities for Disney and GENERAL
Very good diversification
The 3 months correlation between Disney and GENERAL is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Walt Disney and GENERAL ELEC 4125 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GENERAL ELEC 4125 and Disney 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 Walt Disney are associated (or correlated) with GENERAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GENERAL ELEC 4125 has no effect on the direction of Disney i.e., Disney and GENERAL go up and down completely randomly.
Pair Corralation between Disney and GENERAL
Considering the 90-day investment horizon Walt Disney is expected to generate 0.87 times more return on investment than GENERAL. However, Walt Disney is 1.15 times less risky than GENERAL. It trades about 0.47 of its potential returns per unit of risk. GENERAL ELEC 4125 is currently generating about -0.29 per unit of risk. If you would invest 9,620 in Walt Disney on August 27, 2024 and sell it today you would earn a total of 1,945 from holding Walt Disney or generate 20.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 52.38% |
| Values | Daily Returns |
Walt Disney vs. GENERAL ELEC 4125
Performance |
| Timeline |
| Walt Disney |
| GENERAL ELEC 4125 |
Disney and GENERAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Disney and GENERAL
The main advantage of trading using opposite Disney and GENERAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Disney position performs unexpectedly, GENERAL 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 GENERAL will offset losses from the drop in GENERAL's long position.| Disney vs. Roku Inc | Disney vs. AMC Entertainment Holdings | Disney vs. Paramount Global Class | Disney vs. Warner Bros Discovery |
| GENERAL vs. Burlington Stores | GENERAL vs. Vince Holding Corp | GENERAL vs. Skechers USA | GENERAL vs. Westrock Coffee |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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