Correlation Between GM and Ossiam Europe
Can any of the company-specific risk be diversified away by investing in both GM and Ossiam Europe 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 Ossiam Europe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and Ossiam Europe ESG, you can compare the effects of market volatilities on GM and Ossiam Europe 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 Ossiam Europe. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Ossiam Europe.
Diversification Opportunities for GM and Ossiam Europe
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GM and Ossiam is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Ossiam Europe ESG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ossiam Europe ESG 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 Ossiam Europe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ossiam Europe ESG has no effect on the direction of GM i.e., GM and Ossiam Europe go up and down completely randomly.
Pair Corralation between GM and Ossiam Europe
If you would invest 3,778 in General Motors on August 31, 2024 and sell it today you would earn a total of 1,772 from holding General Motors or generate 46.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 98.21% |
| Values | Daily Returns |
General Motors vs. Ossiam Europe ESG
Performance |
| Timeline |
| General Motors |
| Ossiam Europe ESG |
GM and Ossiam Europe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Ossiam Europe
The main advantage of trading using opposite GM and Ossiam Europe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Ossiam Europe 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 Ossiam Europe will offset losses from the drop in Ossiam Europe's long position.The idea behind General Motors and Ossiam Europe ESG 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.| Ossiam Europe vs. Ossiam Lux Ossiam | Ossiam Europe vs. Ossiam Lux | Ossiam Europe vs. Ossiam Shiller Barclays | Ossiam Europe vs. Ossiam Bloomberg USA |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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