Correlation Between GM and Sunzen Biotech
Can any of the company-specific risk be diversified away by investing in both GM and Sunzen Biotech 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 GM and Sunzen Biotech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and Sunzen Biotech Bhd, you can compare the effects of market volatilities on GM and Sunzen Biotech 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 Sunzen Biotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Sunzen Biotech.
Diversification Opportunities for GM and Sunzen Biotech
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between GM and Sunzen is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Sunzen Biotech Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunzen Biotech Bhd 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 Sunzen Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunzen Biotech Bhd has no effect on the direction of GM i.e., GM and Sunzen Biotech go up and down completely randomly.
Pair Corralation between GM and Sunzen Biotech
If you would invest 5,273 in General Motors on August 28, 2024 and sell it today you would earn a total of 747.00 from holding General Motors or generate 14.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
General Motors vs. Sunzen Biotech Bhd
Performance |
| Timeline |
| General Motors |
| Sunzen Biotech Bhd |
GM and Sunzen Biotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Sunzen Biotech
The main advantage of trading using opposite GM and Sunzen Biotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Sunzen Biotech 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 Sunzen Biotech will offset losses from the drop in Sunzen Biotech's long position.The idea behind General Motors and Sunzen Biotech Bhd 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.| Sunzen Biotech vs. Apollo Food Holdings | Sunzen Biotech vs. YX Precious Metals | Sunzen Biotech vs. Melewar Industrial Group | Sunzen Biotech vs. YTL Hospitality REIT |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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