Correlation Between GE Aerospace and AMAZON
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By analyzing existing cross correlation between GE Aerospace and AMAZON INC 38, you can compare the effects of market volatilities on GE Aerospace and AMAZON 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 AMAZON. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Aerospace and AMAZON.
Diversification Opportunities for GE Aerospace and AMAZON
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between GE Aerospace and AMAZON is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding GE Aerospace and AMAZON INC 38 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMAZON INC 38 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 AMAZON. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMAZON INC 38 has no effect on the direction of GE Aerospace i.e., GE Aerospace and AMAZON go up and down completely randomly.
Pair Corralation between GE Aerospace and AMAZON
Allowing for the 90-day total investment horizon GE Aerospace is expected to generate 6.0 times more return on investment than AMAZON. However, GE Aerospace is 6.0 times more volatile than AMAZON INC 38. It trades about 0.16 of its potential returns per unit of risk. AMAZON INC 38 is currently generating about 0.01 per unit of risk. If you would invest 5,118 in GE Aerospace on September 3, 2024 and sell it today you would earn a total of 13,098 from holding GE Aerospace or generate 255.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
GE Aerospace vs. AMAZON INC 38
Performance |
| Timeline |
| GE Aerospace |
| AMAZON INC 38 |
GE Aerospace and AMAZON Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GE Aerospace and AMAZON
The main advantage of trading using opposite GE Aerospace and AMAZON positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GE Aerospace position performs unexpectedly, AMAZON 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 AMAZON will offset losses from the drop in AMAZON'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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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