Correlation Between GE Aerospace and Global
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By analyzing existing cross correlation between GE Aerospace and Global Marine 7, you can compare the effects of market volatilities on GE Aerospace and Global 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 Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Aerospace and Global.
Diversification Opportunities for GE Aerospace and Global
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GE Aerospace and Global is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding GE Aerospace and Global Marine 7 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Marine 7 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 Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Marine 7 has no effect on the direction of GE Aerospace i.e., GE Aerospace and Global go up and down completely randomly.
Pair Corralation between GE Aerospace and Global
Allowing for the 90-day total investment horizon GE Aerospace is expected to generate 1.15 times more return on investment than Global. However, GE Aerospace is 1.15 times more volatile than Global Marine 7. It trades about 0.19 of its potential returns per unit of risk. Global Marine 7 is currently generating about -0.16 per unit of risk. If you would invest 17,176 in GE Aerospace on September 3, 2024 and sell it today you would earn a total of 1,040 from holding GE Aerospace or generate 6.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 85.0% |
| Values | Daily Returns |
GE Aerospace vs. Global Marine 7
Performance |
| Timeline |
| GE Aerospace |
| Global Marine 7 |
GE Aerospace and Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GE Aerospace and Global
The main advantage of trading using opposite GE Aerospace and Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GE Aerospace position performs unexpectedly, Global 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 Global will offset losses from the drop in Global's long position.| GE Aerospace vs. Illinois Tool Works | GE Aerospace vs. Dover | GE Aerospace vs. Cummins | GE Aerospace vs. Eaton PLC |
| Global vs. TFI International | Global vs. SBM Offshore NV | Global vs. BW Offshore Limited | Global vs. Verra Mobility Corp |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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