Correlation Between GM and 517990
Specify exactly 2 symbols:
By analyzing existing cross correlation between General Motors and 517990, you can compare the effects of market volatilities on GM and 517990 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 517990. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and 517990.
Diversification Opportunities for GM and 517990
Very weak diversification
The 3 months correlation between GM and 517990 is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and 517990 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 517990 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 517990. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 517990 has no effect on the direction of GM i.e., GM and 517990 go up and down completely randomly.
Pair Corralation between GM and 517990
Allowing for the 90-day total investment horizon General Motors is expected to generate 0.96 times more return on investment than 517990. However, General Motors is 1.04 times less risky than 517990. It trades about 0.14 of its potential returns per unit of risk. 517990 is currently generating about -0.04 per unit of risk. If you would invest 3,135 in General Motors on August 26, 2024 and sell it today you would earn a total of 2,718 from holding General Motors or generate 86.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.58% |
| Values | Daily Returns |
General Motors vs. 517990
Performance |
| Timeline |
| General Motors |
| 517990 |
GM and 517990 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and 517990
The main advantage of trading using opposite GM and 517990 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, 517990 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 517990 will offset losses from the drop in 517990's long position.The idea behind General Motors and 517990 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.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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |