Correlation Between GM and Greystone Logistics
Can any of the company-specific risk be diversified away by investing in both GM and Greystone Logistics 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 Greystone Logistics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and Greystone Logistics, you can compare the effects of market volatilities on GM and Greystone Logistics 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 Greystone Logistics. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Greystone Logistics.
Diversification Opportunities for GM and Greystone Logistics
-0.87 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GM and Greystone is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Greystone Logistics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greystone Logistics 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 Greystone Logistics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greystone Logistics has no effect on the direction of GM i.e., GM and Greystone Logistics go up and down completely randomly.
Pair Corralation between GM and Greystone Logistics
Allowing for the 90-day total investment horizon General Motors is expected to generate 0.53 times more return on investment than Greystone Logistics. However, General Motors is 1.9 times less risky than Greystone Logistics. It trades about 0.16 of its potential returns per unit of risk. Greystone Logistics is currently generating about -0.13 per unit of risk. If you would invest 4,893 in General Motors on August 28, 2024 and sell it today you would earn a total of 1,127 from holding General Motors or generate 23.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
General Motors vs. Greystone Logistics
Performance |
| Timeline |
| General Motors |
| Greystone Logistics |
GM and Greystone Logistics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Greystone Logistics
The main advantage of trading using opposite GM and Greystone Logistics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Greystone Logistics 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 Greystone Logistics will offset losses from the drop in Greystone Logistics' long position.The idea behind General Motors and Greystone Logistics 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.| Greystone Logistics vs. Ascendant Resources | Greystone Logistics vs. Cantex Mine Development | Greystone Logistics vs. Amarc Resources | Greystone Logistics vs. Sterling Metals Corp |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| 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 | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |