Correlation Between GM and Ninepoint Energy
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By analyzing existing cross correlation between General Motors and Ninepoint Energy, you can compare the effects of market volatilities on GM and Ninepoint Energy 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 Ninepoint Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Ninepoint Energy.
Diversification Opportunities for GM and Ninepoint Energy
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GM and Ninepoint is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Ninepoint Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ninepoint Energy 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 Ninepoint Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ninepoint Energy has no effect on the direction of GM i.e., GM and Ninepoint Energy go up and down completely randomly.
Pair Corralation between GM and Ninepoint Energy
Allowing for the 90-day total investment horizon General Motors is expected to generate 1.37 times more return on investment than Ninepoint Energy. However, GM is 1.37 times more volatile than Ninepoint Energy. It trades about 0.08 of its potential returns per unit of risk. Ninepoint Energy is currently generating about -0.03 per unit of risk. If you would invest 4,411 in General Motors on September 3, 2024 and sell it today you would earn a total of 1,148 from holding General Motors or generate 26.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
General Motors vs. Ninepoint Energy
Performance |
| Timeline |
| General Motors |
| Ninepoint Energy |
GM and Ninepoint Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Ninepoint Energy
The main advantage of trading using opposite GM and Ninepoint Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Ninepoint Energy 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 Ninepoint Energy will offset losses from the drop in Ninepoint Energy's long position.The idea behind General Motors and Ninepoint Energy 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.| Ninepoint Energy vs. Fidelity Tactical High | Ninepoint Energy vs. Fidelity ClearPath 2045 | Ninepoint Energy vs. Global Healthcare Income | Ninepoint Energy vs. CI Global Alpha |
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 CEOs Directory module to screen CEOs from public companies around the world.
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