Correlation Between GE Aerospace and Future Scholar
Can any of the company-specific risk be diversified away by investing in both GE Aerospace and Future Scholar 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 Aerospace and Future Scholar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GE Aerospace and Future Scholar 529, you can compare the effects of market volatilities on GE Aerospace and Future Scholar 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 Aerospace with a short position of Future Scholar. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Aerospace and Future Scholar.
Diversification Opportunities for GE Aerospace and Future Scholar
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GE Aerospace and Future is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding GE Aerospace and Future Scholar 529 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Future Scholar 529 and GE Aerospace 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 Aerospace are associated (or correlated) with Future Scholar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Future Scholar 529 has no effect on the direction of GE Aerospace i.e., GE Aerospace and Future Scholar go up and down completely randomly.
Pair Corralation between GE Aerospace and Future Scholar
Allowing for the 90-day total investment horizon GE Aerospace is expected to generate 4.63 times more return on investment than Future Scholar. However, GE Aerospace is 4.63 times more volatile than Future Scholar 529. It trades about 0.15 of its potential returns per unit of risk. Future Scholar 529 is currently generating about 0.14 per unit of risk. If you would invest 9,546 in GE Aerospace on September 4, 2024 and sell it today you would earn a total of 8,498 from holding GE Aerospace or generate 89.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.6% |
| Values | Daily Returns |
GE Aerospace vs. Future Scholar 529
Performance |
| Timeline |
| GE Aerospace |
| Future Scholar 529 |
GE Aerospace and Future Scholar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GE Aerospace and Future Scholar
The main advantage of trading using opposite GE Aerospace and Future Scholar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GE Aerospace position performs unexpectedly, Future Scholar 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 Future Scholar will offset losses from the drop in Future Scholar's long position.| GE Aerospace vs. Illinois Tool Works | GE Aerospace vs. Dover | GE Aerospace vs. Cummins | GE Aerospace vs. Eaton PLC |
| Future Scholar vs. Health Biotchnology Portfolio | Future Scholar vs. Delaware Healthcare Fund | Future Scholar vs. Baillie Gifford Health | Future Scholar vs. Baron Health Care |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |