Correlation Between GM and Jaguar Global
Can any of the company-specific risk be diversified away by investing in both GM and Jaguar Global 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 Jaguar Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and Jaguar Global Growth, you can compare the effects of market volatilities on GM and Jaguar Global 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 Jaguar Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Jaguar Global.
Diversification Opportunities for GM and Jaguar Global
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GM and Jaguar is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Jaguar Global Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jaguar Global Growth 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 Jaguar Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jaguar Global Growth has no effect on the direction of GM i.e., GM and Jaguar Global go up and down completely randomly.
Pair Corralation between GM and Jaguar Global
If you would invest 4,551 in General Motors on September 1, 2024 and sell it today you would earn a total of 1,008 from holding General Motors or generate 22.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 0.79% |
| Values | Daily Returns |
General Motors vs. Jaguar Global Growth
Performance |
| Timeline |
| General Motors |
| Jaguar Global Growth |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
GM and Jaguar Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Jaguar Global
The main advantage of trading using opposite GM and Jaguar Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Jaguar Global 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 Jaguar Global will offset losses from the drop in Jaguar Global's long position.The idea behind General Motors and Jaguar Global Growth 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.| Jaguar Global vs. Hennessy Capital Investment | Jaguar Global vs. AlphaTime Acquisition Corp | Jaguar Global vs. Manaris 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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