Correlation Between GE Aerospace and Juniper II
Can any of the company-specific risk be diversified away by investing in both GE Aerospace and Juniper II 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 Juniper II into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GE Aerospace and Juniper II Corp, you can compare the effects of market volatilities on GE Aerospace and Juniper II 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 Juniper II. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Aerospace and Juniper II.
Diversification Opportunities for GE Aerospace and Juniper II
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between GE Aerospace and Juniper is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding GE Aerospace and Juniper II Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Juniper II Corp 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 Juniper II. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Juniper II Corp has no effect on the direction of GE Aerospace i.e., GE Aerospace and Juniper II go up and down completely randomly.
Pair Corralation between GE Aerospace and Juniper II
If you would invest 17,536 in GE Aerospace on August 29, 2024 and sell it today you would earn a total of 524.00 from holding GE Aerospace or generate 2.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.35% |
| Values | Daily Returns |
GE Aerospace vs. Juniper II Corp
Performance |
| Timeline |
| GE Aerospace |
| Juniper II Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
GE Aerospace and Juniper II Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GE Aerospace and Juniper II
The main advantage of trading using opposite GE Aerospace and Juniper II positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GE Aerospace position performs unexpectedly, Juniper II 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 Juniper II will offset losses from the drop in Juniper II's long position.| GE Aerospace vs. Parker Hannifin | GE Aerospace vs. Capital Income Builder | GE Aerospace vs. Direxion Daily FTSE | GE Aerospace vs. Dodge Global Stock |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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