Correlation Between GE Aerospace and TRANSCANADA
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By analyzing existing cross correlation between GE Aerospace and TRANSCANADA PIPELINES LTD, you can compare the effects of market volatilities on GE Aerospace and TRANSCANADA 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 TRANSCANADA. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Aerospace and TRANSCANADA.
Diversification Opportunities for GE Aerospace and TRANSCANADA
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between GE Aerospace and TRANSCANADA is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding GE Aerospace and TRANSCANADA PIPELINES LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TRANSCANADA PIPELINES LTD 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 TRANSCANADA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TRANSCANADA PIPELINES LTD has no effect on the direction of GE Aerospace i.e., GE Aerospace and TRANSCANADA go up and down completely randomly.
Pair Corralation between GE Aerospace and TRANSCANADA
Allowing for the 90-day total investment horizon GE Aerospace is expected to generate 0.66 times more return on investment than TRANSCANADA. However, GE Aerospace is 1.52 times less risky than TRANSCANADA. It trades about 0.19 of its potential returns per unit of risk. TRANSCANADA PIPELINES LTD is currently generating about 0.06 per unit of risk. If you would invest 17,170 in GE Aerospace on September 2, 2024 and sell it today you would earn a total of 1,046 from holding GE Aerospace or generate 6.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GE Aerospace vs. TRANSCANADA PIPELINES LTD
Performance |
| Timeline |
| GE Aerospace |
| TRANSCANADA PIPELINES LTD |
GE Aerospace and TRANSCANADA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GE Aerospace and TRANSCANADA
The main advantage of trading using opposite GE Aerospace and TRANSCANADA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GE Aerospace position performs unexpectedly, TRANSCANADA 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 TRANSCANADA will offset losses from the drop in TRANSCANADA's long position.| GE Aerospace vs. Illinois Tool Works | GE Aerospace vs. Dover | GE Aerospace vs. Cummins | GE Aerospace vs. Eaton PLC |
| TRANSCANADA vs. AEP TEX INC | TRANSCANADA vs. US BANK NATIONAL | TRANSCANADA vs. Bank of America | TRANSCANADA 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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