Correlation Between GM and Beijing SuperMap
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By analyzing existing cross correlation between General Motors and Beijing SuperMap Software, you can compare the effects of market volatilities on GM and Beijing SuperMap 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 Beijing SuperMap. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Beijing SuperMap.
Diversification Opportunities for GM and Beijing SuperMap
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between GM and Beijing is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Beijing SuperMap Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing SuperMap Software 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 Beijing SuperMap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing SuperMap Software has no effect on the direction of GM i.e., GM and Beijing SuperMap go up and down completely randomly.
Pair Corralation between GM and Beijing SuperMap
Allowing for the 90-day total investment horizon General Motors is expected to under-perform the Beijing SuperMap. But the stock apears to be less risky and, when comparing its historical volatility, General Motors is 1.65 times less risky than Beijing SuperMap. The stock trades about -0.01 of its potential returns per unit of risk. The Beijing SuperMap Software is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,683 in Beijing SuperMap Software on December 1, 2024 and sell it today you would earn a total of 22.00 from holding Beijing SuperMap Software or generate 1.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.48% |
| Values | Daily Returns |
General Motors vs. Beijing SuperMap Software
Performance |
| Timeline |
| General Motors |
| Beijing SuperMap Software |
GM and Beijing SuperMap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Beijing SuperMap
The main advantage of trading using opposite GM and Beijing SuperMap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Beijing SuperMap 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 Beijing SuperMap will offset losses from the drop in Beijing SuperMap's long position.The idea behind General Motors and Beijing SuperMap Software 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.| Beijing SuperMap vs. Jilin Jlu Communication | Beijing SuperMap vs. Qingdao Hi Tech Moulds | Beijing SuperMap vs. Zhejiang Daily Media | Beijing SuperMap vs. Shenzhen Topway Video |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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