Correlation Between GE Aerospace and 512807AN8
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By analyzing existing cross correlation between GE Aerospace and LAM RESH P, you can compare the effects of market volatilities on GE Aerospace and 512807AN8 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 512807AN8. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Aerospace and 512807AN8.
Diversification Opportunities for GE Aerospace and 512807AN8
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between GE Aerospace and 512807AN8 is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding GE Aerospace and LAM RESH P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LAM RESH P 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 512807AN8. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LAM RESH P has no effect on the direction of GE Aerospace i.e., GE Aerospace and 512807AN8 go up and down completely randomly.
Pair Corralation between GE Aerospace and 512807AN8
Allowing for the 90-day total investment horizon GE Aerospace is expected to generate 8.66 times more return on investment than 512807AN8. However, GE Aerospace is 8.66 times more volatile than LAM RESH P. It trades about 0.16 of its potential returns per unit of risk. LAM RESH P is currently generating about 0.01 per unit of risk. If you would invest 5,138 in GE Aerospace on September 2, 2024 and sell it today you would earn a total of 13,078 from holding GE Aerospace or generate 254.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 91.53% |
| Values | Daily Returns |
GE Aerospace vs. LAM RESH P
Performance |
| Timeline |
| GE Aerospace |
| LAM RESH P |
GE Aerospace and 512807AN8 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GE Aerospace and 512807AN8
The main advantage of trading using opposite GE Aerospace and 512807AN8 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GE Aerospace position performs unexpectedly, 512807AN8 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 512807AN8 will offset losses from the drop in 512807AN8's long position.| GE Aerospace vs. Illinois Tool Works | GE Aerospace vs. Dover | GE Aerospace vs. Cummins | GE Aerospace vs. Eaton PLC |
| 512807AN8 vs. AEP TEX INC | 512807AN8 vs. US BANK NATIONAL | 512807AN8 vs. Bank of America | 512807AN8 vs. GE Aerospace |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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