Correlation Between GM and Cydsa SAB
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By analyzing existing cross correlation between General Motors and Cydsa SAB de, you can compare the effects of market volatilities on GM and Cydsa SAB 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 Cydsa SAB. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Cydsa SAB.
Diversification Opportunities for GM and Cydsa SAB
Modest diversification
The 3 months correlation between GM and Cydsa is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Cydsa SAB de in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cydsa SAB de 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 Cydsa SAB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cydsa SAB de has no effect on the direction of GM i.e., GM and Cydsa SAB go up and down completely randomly.
Pair Corralation between GM and Cydsa SAB
Allowing for the 90-day total investment horizon General Motors is expected to generate 3.42 times more return on investment than Cydsa SAB. However, GM is 3.42 times more volatile than Cydsa SAB de. It trades about 0.16 of its potential returns per unit of risk. Cydsa SAB de is currently generating about 0.34 per unit of risk. If you would invest 5,096 in General Motors on September 2, 2024 and sell it today you would earn a total of 463.00 from holding General Motors or generate 9.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
General Motors vs. Cydsa SAB de
Performance |
| Timeline |
| General Motors |
| Cydsa SAB de |
GM and Cydsa SAB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Cydsa SAB
The main advantage of trading using opposite GM and Cydsa SAB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Cydsa SAB 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 Cydsa SAB will offset losses from the drop in Cydsa SAB's long position.The idea behind General Motors and Cydsa SAB de 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.| Cydsa SAB vs. Ameriprise Financial | Cydsa SAB vs. Capital One Financial | Cydsa SAB vs. Grupo Sports World | Cydsa SAB vs. Delta Air Lines |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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