Correlation Between GM and HYBRIGENICS
Can any of the company-specific risk be diversified away by investing in both GM and HYBRIGENICS 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 HYBRIGENICS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and HYBRIGENICS A , you can compare the effects of market volatilities on GM and HYBRIGENICS 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 HYBRIGENICS. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and HYBRIGENICS.
Diversification Opportunities for GM and HYBRIGENICS
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between GM and HYBRIGENICS is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and HYBRIGENICS A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HYBRIGENICS A 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 HYBRIGENICS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HYBRIGENICS A has no effect on the direction of GM i.e., GM and HYBRIGENICS go up and down completely randomly.
Pair Corralation between GM and HYBRIGENICS
Allowing for the 90-day total investment horizon General Motors is expected to generate 0.41 times more return on investment than HYBRIGENICS. However, General Motors is 2.43 times less risky than HYBRIGENICS. It trades about 0.12 of its potential returns per unit of risk. HYBRIGENICS A is currently generating about -0.17 per unit of risk. If you would invest 5,197 in General Motors on August 31, 2024 and sell it today you would earn a total of 353.00 from holding General Motors or generate 6.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
General Motors vs. HYBRIGENICS A
Performance |
| Timeline |
| General Motors |
| HYBRIGENICS A |
GM and HYBRIGENICS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and HYBRIGENICS
The main advantage of trading using opposite GM and HYBRIGENICS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, HYBRIGENICS 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 HYBRIGENICS will offset losses from the drop in HYBRIGENICS's long position.The idea behind General Motors and HYBRIGENICS A 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.| HYBRIGENICS vs. PLAY2CHILL SA ZY | HYBRIGENICS vs. LG Display Co | HYBRIGENICS vs. Ming Le Sports | HYBRIGENICS vs. PLAYTIKA HOLDING DL 01 |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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