Correlation Between GE Vernova and Marine Products
Can any of the company-specific risk be diversified away by investing in both GE Vernova and Marine Products 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 Marine Products 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 Marine Products, you can compare the effects of market volatilities on GE Vernova and Marine Products 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 Marine Products. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Vernova and Marine Products.
Diversification Opportunities for GE Vernova and Marine Products
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GEV and Marine is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding GE Vernova LLC and Marine Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marine Products 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 Marine Products. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marine Products has no effect on the direction of GE Vernova i.e., GE Vernova and Marine Products go up and down completely randomly.
Pair Corralation between GE Vernova and Marine Products
Considering the 90-day investment horizon GE Vernova LLC is expected to generate 1.18 times more return on investment than Marine Products. However, GE Vernova is 1.18 times more volatile than Marine Products. It trades about 0.19 of its potential returns per unit of risk. Marine Products is currently generating about 0.01 per unit of risk. If you would invest 13,125 in GE Vernova LLC on August 31, 2024 and sell it today you would earn a total of 20,465 from holding GE Vernova LLC or generate 155.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 36.19% |
| Values | Daily Returns |
GE Vernova LLC vs. Marine Products
Performance |
| Timeline |
| GE Vernova LLC |
| Marine Products |
GE Vernova and Marine Products Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GE Vernova and Marine Products
The main advantage of trading using opposite GE Vernova and Marine Products positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GE Vernova position performs unexpectedly, Marine Products 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 Marine Products will offset losses from the drop in Marine Products' long position.| GE Vernova vs. Fluence Energy | GE Vernova vs. Altus Power | GE Vernova vs. Energy Vault Holdings | GE Vernova vs. Enlight Renewable Energy |
| Marine Products vs. Vision Marine Technologies | Marine Products vs. EZGO Technologies | Marine Products vs. LCI Industries | Marine Products vs. Curtiss Motorcycles |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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