Correlation Between GE Aerospace and 872540AQ2
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By analyzing existing cross correlation between GE Aerospace and TJX INC NEW, you can compare the effects of market volatilities on GE Aerospace and 872540AQ2 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 872540AQ2. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Aerospace and 872540AQ2.
Diversification Opportunities for GE Aerospace and 872540AQ2
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between GE Aerospace and 872540AQ2 is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding GE Aerospace and TJX INC NEW in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TJX INC NEW 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 872540AQ2. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TJX INC NEW has no effect on the direction of GE Aerospace i.e., GE Aerospace and 872540AQ2 go up and down completely randomly.
Pair Corralation between GE Aerospace and 872540AQ2
Allowing for the 90-day total investment horizon GE Aerospace is expected to generate 2.54 times more return on investment than 872540AQ2. However, GE Aerospace is 2.54 times more volatile than TJX INC NEW. It trades about 0.53 of its potential returns per unit of risk. TJX INC NEW is currently generating about -0.25 per unit of risk. If you would invest 16,679 in GE Aerospace on November 1, 2024 and sell it today you would earn a total of 3,585 from holding GE Aerospace or generate 21.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
GE Aerospace vs. TJX INC NEW
Performance |
| Timeline |
| GE Aerospace |
| TJX INC NEW |
GE Aerospace and 872540AQ2 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GE Aerospace and 872540AQ2
The main advantage of trading using opposite GE Aerospace and 872540AQ2 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GE Aerospace position performs unexpectedly, 872540AQ2 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 872540AQ2 will offset losses from the drop in 872540AQ2's long position.| GE Aerospace vs. Illinois Tool Works | GE Aerospace vs. Dover | GE Aerospace vs. Cummins | GE Aerospace vs. Eaton PLC |
| 872540AQ2 vs. AEP TEX INC | 872540AQ2 vs. US BANK NATIONAL | 872540AQ2 vs. Albertsons Companies | 872540AQ2 vs. Innovation Beverage Group |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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