Correlation Between GM and Cass Saddle
Can any of the company-specific risk be diversified away by investing in both GM and Cass Saddle 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 Cass Saddle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and Cass Saddle Agriculture, you can compare the effects of market volatilities on GM and Cass Saddle 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 Cass Saddle. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Cass Saddle.
Diversification Opportunities for GM and Cass Saddle
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GM and Cass is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Cass Saddle Agriculture in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cass Saddle Agriculture 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 Cass Saddle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cass Saddle Agriculture has no effect on the direction of GM i.e., GM and Cass Saddle go up and down completely randomly.
Pair Corralation between GM and Cass Saddle
Allowing for the 90-day total investment horizon General Motors is expected to under-perform the Cass Saddle. But the stock apears to be less risky and, when comparing its historical volatility, General Motors is 3.58 times less risky than Cass Saddle. The stock trades about -0.09 of its potential returns per unit of risk. The Cass Saddle Agriculture is currently generating about 0.52 of returns per unit of risk over similar time horizon. If you would invest 500.00 in Cass Saddle Agriculture on November 29, 2024 and sell it today you would earn a total of 400.00 from holding Cass Saddle Agriculture or generate 80.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
General Motors vs. Cass Saddle Agriculture
Performance |
| Timeline |
| General Motors |
| Cass Saddle Agriculture |
GM and Cass Saddle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Cass Saddle
The main advantage of trading using opposite GM and Cass Saddle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Cass Saddle 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 Cass Saddle will offset losses from the drop in Cass Saddle's long position.The idea behind General Motors and Cass Saddle Agriculture 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.| Cass Saddle vs. RIO ZIM LIMITED | Cass Saddle vs. Tigere Real Estate | Cass Saddle vs. STAR AFRICA PORATION | Cass Saddle vs. Datvest Modified Consumer |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |