Correlation Between GM and AwoX SA
Can any of the company-specific risk be diversified away by investing in both GM and AwoX SA 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 AwoX SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and AwoX SA, you can compare the effects of market volatilities on GM and AwoX SA 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 AwoX SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and AwoX SA.
Diversification Opportunities for GM and AwoX SA
Pay attention - limited upside
The 3 months correlation between GM and AwoX is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and AwoX SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AwoX SA 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 AwoX SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AwoX SA has no effect on the direction of GM i.e., GM and AwoX SA go up and down completely randomly.
Pair Corralation between GM and AwoX SA
If you would invest 3,692 in General Motors on September 5, 2024 and sell it today you would earn a total of 1,674 from holding General Motors or generate 45.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.2% |
| Values | Daily Returns |
General Motors vs. AwoX SA
Performance |
| Timeline |
| General Motors |
| AwoX SA |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
GM and AwoX SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and AwoX SA
The main advantage of trading using opposite GM and AwoX SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, AwoX SA 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 AwoX SA will offset losses from the drop in AwoX SA's long position.The idea behind General Motors and AwoX SA 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.| AwoX SA vs. Axway Software | AwoX SA vs. Metalliance SA | AwoX SA vs. Linedata Services SA | AwoX SA vs. Gaztransport Technigaz SAS |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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