Correlation Between GE Aerospace and ENBRIDGE
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By analyzing existing cross correlation between GE Aerospace and ENBRIDGE INC 425, you can compare the effects of market volatilities on GE Aerospace and ENBRIDGE 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 ENBRIDGE. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Aerospace and ENBRIDGE.
Diversification Opportunities for GE Aerospace and ENBRIDGE
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between GE Aerospace and ENBRIDGE is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding GE Aerospace and ENBRIDGE INC 425 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ENBRIDGE INC 425 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 ENBRIDGE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ENBRIDGE INC 425 has no effect on the direction of GE Aerospace i.e., GE Aerospace and ENBRIDGE go up and down completely randomly.
Pair Corralation between GE Aerospace and ENBRIDGE
Allowing for the 90-day total investment horizon GE Aerospace is expected to generate 12.49 times more return on investment than ENBRIDGE. However, GE Aerospace is 12.49 times more volatile than ENBRIDGE INC 425. It trades about 0.45 of its potential returns per unit of risk. ENBRIDGE INC 425 is currently generating about 0.06 per unit of risk. If you would invest 17,289 in GE Aerospace on November 9, 2024 and sell it today you would earn a total of 3,317 from holding GE Aerospace or generate 19.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
GE Aerospace vs. ENBRIDGE INC 425
Performance |
| Timeline |
| GE Aerospace |
| ENBRIDGE INC 425 |
GE Aerospace and ENBRIDGE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GE Aerospace and ENBRIDGE
The main advantage of trading using opposite GE Aerospace and ENBRIDGE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GE Aerospace position performs unexpectedly, ENBRIDGE 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 ENBRIDGE will offset losses from the drop in ENBRIDGE's long position.| GE Aerospace vs. Great Western Minerals | GE Aerospace vs. Enterprise Bancorp | GE Aerospace vs. T Rowe Price | GE Aerospace vs. Aviat Networks |
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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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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