Correlation Between GE Vernova and Burlington Stores
Can any of the company-specific risk be diversified away by investing in both GE Vernova and Burlington Stores at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining GE Vernova and Burlington Stores into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GE Vernova LLC and Burlington Stores, you can compare the effects of market volatilities on GE Vernova and Burlington Stores 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 Vernova with a short position of Burlington Stores. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Vernova and Burlington Stores.
Diversification Opportunities for GE Vernova and Burlington Stores
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between GEV and Burlington is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding GE Vernova LLC and Burlington Stores in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Burlington Stores and GE Vernova 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 Vernova LLC are associated (or correlated) with Burlington Stores. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Burlington Stores has no effect on the direction of GE Vernova i.e., GE Vernova and Burlington Stores go up and down completely randomly.
Pair Corralation between GE Vernova and Burlington Stores
Considering the 90-day investment horizon GE Vernova LLC is expected to generate 1.18 times more return on investment than Burlington Stores. However, GE Vernova is 1.18 times more volatile than Burlington Stores. It trades about 0.19 of its potential returns per unit of risk. Burlington Stores is currently generating about 0.08 per unit of risk. If you would invest 13,125 in GE Vernova LLC on September 12, 2024 and sell it today you would earn a total of 21,500 from holding GE Vernova LLC or generate 163.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 54.38% |
| Values | Daily Returns |
GE Vernova LLC vs. Burlington Stores
Performance |
| Timeline |
| GE Vernova LLC |
| Burlington Stores |
GE Vernova and Burlington Stores Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GE Vernova and Burlington Stores
The main advantage of trading using opposite GE Vernova and Burlington Stores positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GE Vernova position performs unexpectedly, Burlington Stores 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 Burlington Stores will offset losses from the drop in Burlington Stores' long position.| GE Vernova vs. Atlantica Sustainable Infrastructure | GE Vernova vs. Verde Clean Fuels | GE Vernova vs. ReNew Energy Global | GE Vernova vs. Ellomay Capital |
| Burlington Stores vs. Foot Locker | Burlington Stores vs. Lands End | Burlington Stores vs. Duluth Holdings | Burlington Stores vs. Destination XL 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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