Correlation Between GM and Dynamic Alternative
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By analyzing existing cross correlation between General Motors and Dynamic Alternative Yield, you can compare the effects of market volatilities on GM and Dynamic Alternative 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 Dynamic Alternative. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Dynamic Alternative.
Diversification Opportunities for GM and Dynamic Alternative
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between GM and Dynamic is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Dynamic Alternative Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dynamic Alternative Yield 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 Dynamic Alternative. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dynamic Alternative Yield has no effect on the direction of GM i.e., GM and Dynamic Alternative go up and down completely randomly.
Pair Corralation between GM and Dynamic Alternative
Allowing for the 90-day total investment horizon General Motors is expected to generate 6.41 times more return on investment than Dynamic Alternative. However, GM is 6.41 times more volatile than Dynamic Alternative Yield. It trades about 0.03 of its potential returns per unit of risk. Dynamic Alternative Yield is currently generating about 0.12 per unit of risk. If you would invest 5,261 in General Motors on October 26, 2024 and sell it today you would earn a total of 161.00 from holding General Motors or generate 3.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.33% |
| Values | Daily Returns |
General Motors vs. Dynamic Alternative Yield
Performance |
| Timeline |
| General Motors |
| Dynamic Alternative Yield |
GM and Dynamic Alternative Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Dynamic Alternative
The main advantage of trading using opposite GM and Dynamic Alternative positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Dynamic Alternative 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 Dynamic Alternative will offset losses from the drop in Dynamic Alternative's long position.The idea behind General Motors and Dynamic Alternative Yield 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.| Dynamic Alternative vs. Tangerine Equity Growth | Dynamic Alternative vs. RBC Canadian Equity | Dynamic Alternative vs. Manulife Global Equity | Dynamic Alternative vs. CDSPI Canadian Equity |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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