Correlation Between GE Aerospace and DOMTAR
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By analyzing existing cross correlation between GE Aerospace and DOMTAR P 675, you can compare the effects of market volatilities on GE Aerospace and DOMTAR 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 DOMTAR. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Aerospace and DOMTAR.
Diversification Opportunities for GE Aerospace and DOMTAR
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between GE Aerospace and DOMTAR is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding GE Aerospace and DOMTAR P 675 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DOMTAR P 675 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 DOMTAR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DOMTAR P 675 has no effect on the direction of GE Aerospace i.e., GE Aerospace and DOMTAR go up and down completely randomly.
Pair Corralation between GE Aerospace and DOMTAR
Allowing for the 90-day total investment horizon GE Aerospace is expected to generate 0.54 times more return on investment than DOMTAR. However, GE Aerospace is 1.87 times less risky than DOMTAR. It trades about 0.05 of its potential returns per unit of risk. DOMTAR P 675 is currently generating about 0.0 per unit of risk. If you would invest 15,539 in GE Aerospace on September 12, 2024 and sell it today you would earn a total of 1,588 from holding GE Aerospace or generate 10.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 91.2% |
| Values | Daily Returns |
GE Aerospace vs. DOMTAR P 675
Performance |
| Timeline |
| GE Aerospace |
| DOMTAR P 675 |
GE Aerospace and DOMTAR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GE Aerospace and DOMTAR
The main advantage of trading using opposite GE Aerospace and DOMTAR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GE Aerospace position performs unexpectedly, DOMTAR 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 DOMTAR will offset losses from the drop in DOMTAR's long position.| GE Aerospace vs. Victory Integrity Smallmid Cap | GE Aerospace vs. Hilton Worldwide Holdings | GE Aerospace vs. NVIDIA | GE Aerospace vs. JPMorgan Chase Co |
| DOMTAR vs. NETGEAR | DOMTAR vs. Sphere Entertainment Co | DOMTAR vs. Dave Busters Entertainment | DOMTAR vs. Grupo Televisa SAB |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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