Correlation Between GE Aerospace and Sterling Check
Can any of the company-specific risk be diversified away by investing in both GE Aerospace and Sterling Check 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 Sterling Check into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GE Aerospace and Sterling Check Corp, you can compare the effects of market volatilities on GE Aerospace and Sterling Check 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 Sterling Check. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Aerospace and Sterling Check.
Diversification Opportunities for GE Aerospace and Sterling Check
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between GE Aerospace and Sterling is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding GE Aerospace and Sterling Check Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sterling Check 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 Sterling Check. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sterling Check Corp has no effect on the direction of GE Aerospace i.e., GE Aerospace and Sterling Check go up and down completely randomly.
Pair Corralation between GE Aerospace and Sterling Check
If you would invest 1,674 in Sterling Check Corp on September 20, 2024 and sell it today you would earn a total of 0.00 from holding Sterling Check Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
GE Aerospace vs. Sterling Check Corp
Performance |
| Timeline |
| GE Aerospace |
| Sterling Check Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
GE Aerospace and Sterling Check Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GE Aerospace and Sterling Check
The main advantage of trading using opposite GE Aerospace and Sterling Check positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GE Aerospace position performs unexpectedly, Sterling Check 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 Sterling Check will offset losses from the drop in Sterling Check's long position.| GE Aerospace vs. Illinois Tool Works | GE Aerospace vs. Dover | GE Aerospace vs. Cummins | GE Aerospace vs. Eaton PLC |
| Sterling Check vs. EverCommerce | Sterling Check vs. Evertec | Sterling Check vs. Consensus Cloud Solutions | Sterling Check vs. CSG Systems International |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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