Correlation Between GE Aerospace and UMF
Can any of the company-specific risk be diversified away by investing in both GE Aerospace and UMF 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 UMF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GE Aerospace and UMF Group, you can compare the effects of market volatilities on GE Aerospace and UMF 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 UMF. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Aerospace and UMF.
Diversification Opportunities for GE Aerospace and UMF
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GE Aerospace and UMF is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding GE Aerospace and UMF Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UMF Group 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 UMF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UMF Group has no effect on the direction of GE Aerospace i.e., GE Aerospace and UMF go up and down completely randomly.
Pair Corralation between GE Aerospace and UMF
If you would invest 7,909 in GE Aerospace on January 12, 2025 and sell it today you would earn a total of 10,258 from holding GE Aerospace or generate 129.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
GE Aerospace vs. UMF Group
Performance |
| Timeline |
| GE Aerospace |
| UMF Group |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
GE Aerospace and UMF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GE Aerospace and UMF
The main advantage of trading using opposite GE Aerospace and UMF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GE Aerospace position performs unexpectedly, UMF 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 UMF will offset losses from the drop in UMF's long position.| GE Aerospace vs. Illinois Tool Works | GE Aerospace vs. Dover | GE Aerospace vs. Cummins | GE Aerospace vs. Eaton PLC |
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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