Correlation Between General Mills and Illumina
Can any of the company-specific risk be diversified away by investing in both General Mills and Illumina 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 General Mills and Illumina into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Mills and Illumina, you can compare the effects of market volatilities on General Mills and Illumina 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 General Mills with a short position of Illumina. Check out your portfolio center. Please also check ongoing floating volatility patterns of General Mills and Illumina.
Diversification Opportunities for General Mills and Illumina
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between General and Illumina is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding General Mills and Illumina in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Illumina and General Mills 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 General Mills are associated (or correlated) with Illumina. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Illumina has no effect on the direction of General Mills i.e., General Mills and Illumina go up and down completely randomly.
Pair Corralation between General Mills and Illumina
Assuming the 90 days horizon General Mills is expected to generate 0.83 times more return on investment than Illumina. However, General Mills is 1.21 times less risky than Illumina. It trades about 0.17 of its potential returns per unit of risk. Illumina is currently generating about -0.01 per unit of risk. If you would invest 8,200 in General Mills on September 2, 2024 and sell it today you would earn a total of 658.00 from holding General Mills or generate 8.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
General Mills vs. Illumina
Performance |
| Timeline |
| General Mills |
| Illumina |
General Mills and Illumina Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with General Mills and Illumina
The main advantage of trading using opposite General Mills and Illumina positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if General Mills position performs unexpectedly, Illumina 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 Illumina will offset losses from the drop in Illumina's long position.| General Mills vs. SLR Investment Corp | General Mills vs. Chuangs China Investments | General Mills vs. PLAYSTUDIOS A DL 0001 | General Mills vs. Apollo Investment Corp |
| Illumina vs. PT Bank Maybank | Illumina vs. OAKTRSPECLENDNEW | Illumina vs. CHEMICAL INDUSTRIES | Illumina vs. Eastman Chemical |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Stocks Directory Find actively traded stocks across global markets | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |