Correlation Between GM and KingsoftLimited
Can any of the company-specific risk be diversified away by investing in both GM and KingsoftLimited 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 KingsoftLimited into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and Kingsoft Limited, you can compare the effects of market volatilities on GM and KingsoftLimited 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 KingsoftLimited. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and KingsoftLimited.
Diversification Opportunities for GM and KingsoftLimited
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between GM and KingsoftLimited is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Kingsoft Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kingsoft Limited 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 KingsoftLimited. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kingsoft Limited has no effect on the direction of GM i.e., GM and KingsoftLimited go up and down completely randomly.
Pair Corralation between GM and KingsoftLimited
If you would invest 420.00 in Kingsoft Limited on November 28, 2024 and sell it today you would earn a total of 0.00 from holding Kingsoft Limited or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
General Motors vs. Kingsoft Limited
Performance |
| Timeline |
| General Motors |
| Kingsoft Limited |
GM and KingsoftLimited Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and KingsoftLimited
The main advantage of trading using opposite GM and KingsoftLimited positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, KingsoftLimited 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 KingsoftLimited will offset losses from the drop in KingsoftLimited's long position.The idea behind General Motors and Kingsoft Limited 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.| KingsoftLimited vs. UbiSoft Entertainment | KingsoftLimited vs. Sega Sammy Holdings | KingsoftLimited vs. Capcom Co Ltd | KingsoftLimited vs. GDEV Inc |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |