Correlation Between GE Aerospace and Touchstone ETF
Can any of the company-specific risk be diversified away by investing in both GE Aerospace and Touchstone ETF 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 Touchstone ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GE Aerospace and Touchstone ETF Trust, you can compare the effects of market volatilities on GE Aerospace and Touchstone ETF 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 Touchstone ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Aerospace and Touchstone ETF.
Diversification Opportunities for GE Aerospace and Touchstone ETF
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GE Aerospace and Touchstone is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding GE Aerospace and Touchstone ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Touchstone ETF Trust 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 Touchstone ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Touchstone ETF Trust has no effect on the direction of GE Aerospace i.e., GE Aerospace and Touchstone ETF go up and down completely randomly.
Pair Corralation between GE Aerospace and Touchstone ETF
Allowing for the 90-day total investment horizon GE Aerospace is expected to generate 13.77 times more return on investment than Touchstone ETF. However, GE Aerospace is 13.77 times more volatile than Touchstone ETF Trust. It trades about 0.03 of its potential returns per unit of risk. Touchstone ETF Trust is currently generating about -0.09 per unit of risk. If you would invest 17,104 in GE Aerospace on October 9, 2024 and sell it today you would earn a total of 141.00 from holding GE Aerospace or generate 0.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GE Aerospace vs. Touchstone ETF Trust
Performance |
| Timeline |
| GE Aerospace |
| Touchstone ETF Trust |
GE Aerospace and Touchstone ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GE Aerospace and Touchstone ETF
The main advantage of trading using opposite GE Aerospace and Touchstone ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GE Aerospace position performs unexpectedly, Touchstone ETF 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 Touchstone ETF will offset losses from the drop in Touchstone ETF's long position.| GE Aerospace vs. Illinois Tool Works | GE Aerospace vs. Dover | GE Aerospace vs. Cummins | GE Aerospace vs. Eaton PLC |
| Touchstone ETF vs. Valued Advisers Trust | Touchstone ETF vs. Columbia Diversified Fixed | Touchstone ETF vs. Principal Exchange Traded Funds | Touchstone ETF vs. Doubleline Etf Trust |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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