Correlation Between GM and Zhejiang Mtcn
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By analyzing existing cross correlation between General Motors and Zhejiang Mtcn Technology, you can compare the effects of market volatilities on GM and Zhejiang Mtcn 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 GM with a short position of Zhejiang Mtcn. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Zhejiang Mtcn.
Diversification Opportunities for GM and Zhejiang Mtcn
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GM and Zhejiang is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Zhejiang Mtcn Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Mtcn Technology and GM 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 Motors are associated (or correlated) with Zhejiang Mtcn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Mtcn Technology has no effect on the direction of GM i.e., GM and Zhejiang Mtcn go up and down completely randomly.
Pair Corralation between GM and Zhejiang Mtcn
Allowing for the 90-day total investment horizon General Motors is expected to generate 0.84 times more return on investment than Zhejiang Mtcn. However, General Motors is 1.2 times less risky than Zhejiang Mtcn. It trades about 0.12 of its potential returns per unit of risk. Zhejiang Mtcn Technology is currently generating about 0.07 per unit of risk. If you would invest 5,180 in General Motors on September 4, 2024 and sell it today you would earn a total of 324.00 from holding General Motors or generate 6.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
General Motors vs. Zhejiang Mtcn Technology
Performance |
| Timeline |
| General Motors |
| Zhejiang Mtcn Technology |
GM and Zhejiang Mtcn Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Zhejiang Mtcn
The main advantage of trading using opposite GM and Zhejiang Mtcn positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Zhejiang Mtcn 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 Zhejiang Mtcn will offset losses from the drop in Zhejiang Mtcn's long position.The idea behind General Motors and Zhejiang Mtcn Technology pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Zhejiang Mtcn vs. Kingsignal Technology Co | Zhejiang Mtcn vs. Zhejiang Kingland Pipeline | Zhejiang Mtcn vs. Hubei Xingfa Chemicals | Zhejiang Mtcn vs. ROPEOK Technology 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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