Correlation Between GM and Baylin Technologies
Can any of the company-specific risk be diversified away by investing in both GM and Baylin Technologies 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 Baylin Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and Baylin Technologies, you can compare the effects of market volatilities on GM and Baylin Technologies 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 Baylin Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Baylin Technologies.
Diversification Opportunities for GM and Baylin Technologies
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between GM and Baylin is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Baylin Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baylin Technologies 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 Baylin Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baylin Technologies has no effect on the direction of GM i.e., GM and Baylin Technologies go up and down completely randomly.
Pair Corralation between GM and Baylin Technologies
Allowing for the 90-day total investment horizon General Motors is expected to generate 0.27 times more return on investment than Baylin Technologies. However, General Motors is 3.66 times less risky than Baylin Technologies. It trades about 0.32 of its potential returns per unit of risk. Baylin Technologies is currently generating about -0.12 per unit of risk. If you would invest 5,273 in General Motors on August 27, 2024 and sell it today you would earn a total of 747.00 from holding General Motors or generate 14.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
General Motors vs. Baylin Technologies
Performance |
| Timeline |
| General Motors |
| Baylin Technologies |
GM and Baylin Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Baylin Technologies
The main advantage of trading using opposite GM and Baylin Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Baylin Technologies 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 Baylin Technologies will offset losses from the drop in Baylin Technologies' long position.The idea behind General Motors and Baylin Technologies 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.| Baylin Technologies vs. Current Water Technologies | Baylin Technologies vs. Sparta Capital | Baylin Technologies vs. Fintech Select | Baylin Technologies vs. iShares Canadian HYBrid |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |