Correlation Between GE Aerospace and 191216CE8
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By analyzing existing cross correlation between GE Aerospace and COCA A 29, you can compare the effects of market volatilities on GE Aerospace and 191216CE8 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 191216CE8. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Aerospace and 191216CE8.
Diversification Opportunities for GE Aerospace and 191216CE8
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GE Aerospace and 191216CE8 is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding GE Aerospace and COCA A 29 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COCA A 29 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 191216CE8. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COCA A 29 has no effect on the direction of GE Aerospace i.e., GE Aerospace and 191216CE8 go up and down completely randomly.
Pair Corralation between GE Aerospace and 191216CE8
Allowing for the 90-day total investment horizon GE Aerospace is expected to generate 2.31 times more return on investment than 191216CE8. However, GE Aerospace is 2.31 times more volatile than COCA A 29. It trades about 0.01 of its potential returns per unit of risk. COCA A 29 is currently generating about -0.01 per unit of risk. If you would invest 16,945 in GE Aerospace on September 12, 2024 and sell it today you would lose (53.00) from holding GE Aerospace or give up 0.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.31% |
| Values | Daily Returns |
GE Aerospace vs. COCA A 29
Performance |
| Timeline |
| GE Aerospace |
| COCA A 29 |
GE Aerospace and 191216CE8 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GE Aerospace and 191216CE8
The main advantage of trading using opposite GE Aerospace and 191216CE8 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GE Aerospace position performs unexpectedly, 191216CE8 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 191216CE8 will offset losses from the drop in 191216CE8's long position.| GE Aerospace vs. Illinois Tool Works | GE Aerospace vs. Dover | GE Aerospace vs. Cummins | GE Aerospace vs. Eaton PLC |
| 191216CE8 vs. Stagwell | 191216CE8 vs. ArcelorMittal SA ADR | 191216CE8 vs. Kaiser Aluminum | 191216CE8 vs. Xunlei Ltd Adr |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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