Correlation Between GM and SI Participations
Can any of the company-specific risk be diversified away by investing in both GM and SI Participations 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 SI Participations into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and SI Participations SCA, you can compare the effects of market volatilities on GM and SI Participations 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 SI Participations. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and SI Participations.
Diversification Opportunities for GM and SI Participations
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GM and ALSIP is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and SI Participations SCA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SI Participations SCA 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 SI Participations. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SI Participations SCA has no effect on the direction of GM i.e., GM and SI Participations go up and down completely randomly.
Pair Corralation between GM and SI Participations
If you would invest (100.00) in SI Participations SCA on September 14, 2024 and sell it today you would earn a total of 100.00 from holding SI Participations SCA or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
General Motors vs. SI Participations SCA
Performance |
| Timeline |
| General Motors |
| SI Participations SCA |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
GM and SI Participations Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and SI Participations
The main advantage of trading using opposite GM and SI Participations positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, SI Participations 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 SI Participations will offset losses from the drop in SI Participations' long position.The idea behind General Motors and SI Participations SCA 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.| SI Participations vs. Bilendi | SI Participations vs. Gaztransport Technigaz SAS | SI Participations vs. Mauna Kea Technologies | SI Participations vs. CMG Cleantech SA |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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