Correlation Between GE Aerospace and UNITED
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By analyzing existing cross correlation between GE Aerospace and UNITED TECHNOLOGIES P, you can compare the effects of market volatilities on GE Aerospace and UNITED 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 UNITED. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Aerospace and UNITED.
Diversification Opportunities for GE Aerospace and UNITED
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GE Aerospace and UNITED is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding GE Aerospace and UNITED TECHNOLOGIES P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UNITED TECHNOLOGIES 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 UNITED. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UNITED TECHNOLOGIES has no effect on the direction of GE Aerospace i.e., GE Aerospace and UNITED go up and down completely randomly.
Pair Corralation between GE Aerospace and UNITED
Allowing for the 90-day total investment horizon GE Aerospace is expected to generate 6.85 times less return on investment than UNITED. But when comparing it to its historical volatility, GE Aerospace is 26.45 times less risky than UNITED. It trades about 0.16 of its potential returns per unit of risk. UNITED TECHNOLOGIES P is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 9,490 in UNITED TECHNOLOGIES P on September 2, 2024 and sell it today you would lose (235.00) from holding UNITED TECHNOLOGIES P or give up 2.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.19% |
| Values | Daily Returns |
GE Aerospace vs. UNITED TECHNOLOGIES P
Performance |
| Timeline |
| GE Aerospace |
| UNITED TECHNOLOGIES |
GE Aerospace and UNITED Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GE Aerospace and UNITED
The main advantage of trading using opposite GE Aerospace and UNITED positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GE Aerospace position performs unexpectedly, UNITED 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 UNITED will offset losses from the drop in UNITED's long position.| GE Aerospace vs. Illinois Tool Works | GE Aerospace vs. Dover | GE Aerospace vs. Cummins | GE Aerospace vs. Eaton PLC |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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