Correlation Between GM and Daishin Balance
Can any of the company-specific risk be diversified away by investing in both GM and Daishin Balance 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 Daishin Balance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and Daishin Balance No, you can compare the effects of market volatilities on GM and Daishin Balance 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 Daishin Balance. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Daishin Balance.
Diversification Opportunities for GM and Daishin Balance
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GM and Daishin is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Daishin Balance No in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daishin Balance No 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 Daishin Balance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daishin Balance No has no effect on the direction of GM i.e., GM and Daishin Balance go up and down completely randomly.
Pair Corralation between GM and Daishin Balance
Allowing for the 90-day total investment horizon General Motors is expected to under-perform the Daishin Balance. But the stock apears to be less risky and, when comparing its historical volatility, General Motors is 1.39 times less risky than Daishin Balance. The stock trades about -0.15 of its potential returns per unit of risk. The Daishin Balance No is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest 108,800 in Daishin Balance No on September 13, 2024 and sell it today you would lose (9,300) from holding Daishin Balance No or give up 8.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
General Motors vs. Daishin Balance No
Performance |
| Timeline |
| General Motors |
| Daishin Balance No |
GM and Daishin Balance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Daishin Balance
The main advantage of trading using opposite GM and Daishin Balance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Daishin Balance 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 Daishin Balance will offset losses from the drop in Daishin Balance's long position.The idea behind General Motors and Daishin Balance No 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.| Daishin Balance vs. Korean Reinsurance Co | Daishin Balance vs. CU Tech Corp | Daishin Balance vs. Digital Power Communications | Daishin Balance vs. Lotte Non Life Insurance |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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