Correlation Between GM and BARINGS DEVELOPED
Can any of the company-specific risk be diversified away by investing in both GM and BARINGS DEVELOPED 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 BARINGS DEVELOPED into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and BARINGS DEVELOPED AND, you can compare the effects of market volatilities on GM and BARINGS DEVELOPED 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 BARINGS DEVELOPED. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and BARINGS DEVELOPED.
Diversification Opportunities for GM and BARINGS DEVELOPED
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GM and BARINGS is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and BARINGS DEVELOPED AND in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BARINGS DEVELOPED AND 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 BARINGS DEVELOPED. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BARINGS DEVELOPED AND has no effect on the direction of GM i.e., GM and BARINGS DEVELOPED go up and down completely randomly.
Pair Corralation between GM and BARINGS DEVELOPED
Allowing for the 90-day total investment horizon General Motors is expected to under-perform the BARINGS DEVELOPED. In addition to that, GM is 3.73 times more volatile than BARINGS DEVELOPED AND. It trades about -0.34 of its total potential returns per unit of risk. BARINGS DEVELOPED AND is currently generating about 0.09 per unit of volatility. If you would invest 733.00 in BARINGS DEVELOPED AND on November 27, 2024 and sell it today you would earn a total of 8.00 from holding BARINGS DEVELOPED AND or generate 1.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
General Motors vs. BARINGS DEVELOPED AND
Performance |
| Timeline |
| General Motors |
| BARINGS DEVELOPED AND |
GM and BARINGS DEVELOPED Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and BARINGS DEVELOPED
The main advantage of trading using opposite GM and BARINGS DEVELOPED positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, BARINGS DEVELOPED 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 BARINGS DEVELOPED will offset losses from the drop in BARINGS DEVELOPED's long position.The idea behind General Motors and BARINGS DEVELOPED AND 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.| BARINGS DEVELOPED vs. Esfera Robotics R | BARINGS DEVELOPED vs. R co Valor F | BARINGS DEVELOPED vs. CM AM Monplus NE | BARINGS DEVELOPED vs. IE00B0H4TS55 |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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