Correlation Between GM and Intralot
Can any of the company-specific risk be diversified away by investing in both GM and Intralot 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 Intralot into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and Intralot SA Integrated, you can compare the effects of market volatilities on GM and Intralot 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 Intralot. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Intralot.
Diversification Opportunities for GM and Intralot
Pay attention - limited upside
The 3 months correlation between GM and Intralot is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Intralot SA Integrated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intralot SA Integrated 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 Intralot. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intralot SA Integrated has no effect on the direction of GM i.e., GM and Intralot go up and down completely randomly.
Pair Corralation between GM and Intralot
Allowing for the 90-day total investment horizon General Motors is expected to generate 1.36 times more return on investment than Intralot. However, GM is 1.36 times more volatile than Intralot SA Integrated. It trades about 0.15 of its potential returns per unit of risk. Intralot SA Integrated is currently generating about -0.22 per unit of risk. If you would invest 4,648 in General Motors on August 28, 2024 and sell it today you would earn a total of 831.00 from holding General Motors or generate 17.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 97.67% |
| Values | Daily Returns |
General Motors vs. Intralot SA Integrated
Performance |
| Timeline |
| General Motors |
| Intralot SA Integrated |
GM and Intralot Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Intralot
The main advantage of trading using opposite GM and Intralot positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Intralot 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 Intralot will offset losses from the drop in Intralot's long position.The idea behind General Motors and Intralot SA Integrated 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.| Intralot vs. Mytilineos SA | Intralot vs. Hellenic Telecommunications Organization | Intralot vs. Motor Oil Corinth | Intralot vs. Alpha Services and |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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