Correlation Between GM and BAYPORT MANAGEMENT
Can any of the company-specific risk be diversified away by investing in both GM and BAYPORT MANAGEMENT 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 BAYPORT MANAGEMENT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and BAYPORT MANAGEMENT LTD, you can compare the effects of market volatilities on GM and BAYPORT MANAGEMENT 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 BAYPORT MANAGEMENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and BAYPORT MANAGEMENT.
Diversification Opportunities for GM and BAYPORT MANAGEMENT
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GM and BAYPORT is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and BAYPORT MANAGEMENT LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BAYPORT MANAGEMENT LTD 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 BAYPORT MANAGEMENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BAYPORT MANAGEMENT LTD has no effect on the direction of GM i.e., GM and BAYPORT MANAGEMENT go up and down completely randomly.
Pair Corralation between GM and BAYPORT MANAGEMENT
Allowing for the 90-day total investment horizon General Motors is expected to generate 6.75 times more return on investment than BAYPORT MANAGEMENT. However, GM is 6.75 times more volatile than BAYPORT MANAGEMENT LTD. It trades about 0.05 of its potential returns per unit of risk. BAYPORT MANAGEMENT LTD is currently generating about 0.06 per unit of risk. If you would invest 3,778 in General Motors on September 2, 2024 and sell it today you would earn a total of 1,781 from holding General Motors or generate 47.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 56.05% |
| Values | Daily Returns |
General Motors vs. BAYPORT MANAGEMENT LTD
Performance |
| Timeline |
| General Motors |
| BAYPORT MANAGEMENT LTD |
GM and BAYPORT MANAGEMENT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and BAYPORT MANAGEMENT
The main advantage of trading using opposite GM and BAYPORT MANAGEMENT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, BAYPORT MANAGEMENT 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 BAYPORT MANAGEMENT will offset losses from the drop in BAYPORT MANAGEMENT's long position.The idea behind General Motors and BAYPORT MANAGEMENT LTD 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.| BAYPORT MANAGEMENT vs. FINCORP INVESTMENT LTD | BAYPORT MANAGEMENT vs. MCB GROUP LTD | BAYPORT MANAGEMENT vs. CAUDAN DEVELOPMENT LTD | BAYPORT MANAGEMENT vs. LUX ISLAND RESORTS |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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