Correlation Between GE Aerospace and BIOGEN
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By analyzing existing cross correlation between GE Aerospace and BIOGEN INC, you can compare the effects of market volatilities on GE Aerospace and BIOGEN 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 BIOGEN. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Aerospace and BIOGEN.
Diversification Opportunities for GE Aerospace and BIOGEN
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GE Aerospace and BIOGEN is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding GE Aerospace and BIOGEN INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BIOGEN INC 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 BIOGEN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BIOGEN INC has no effect on the direction of GE Aerospace i.e., GE Aerospace and BIOGEN go up and down completely randomly.
Pair Corralation between GE Aerospace and BIOGEN
Allowing for the 90-day total investment horizon GE Aerospace is expected to generate 0.46 times more return on investment than BIOGEN. However, GE Aerospace is 2.16 times less risky than BIOGEN. It trades about 0.19 of its potential returns per unit of risk. BIOGEN INC is currently generating about 0.02 per unit of risk. If you would invest 17,178 in GE Aerospace on September 1, 2024 and sell it today you would earn a total of 1,038 from holding GE Aerospace or generate 6.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
GE Aerospace vs. BIOGEN INC
Performance |
| Timeline |
| GE Aerospace |
| BIOGEN INC |
GE Aerospace and BIOGEN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GE Aerospace and BIOGEN
The main advantage of trading using opposite GE Aerospace and BIOGEN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GE Aerospace position performs unexpectedly, BIOGEN 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 BIOGEN will offset losses from the drop in BIOGEN'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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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