Correlation Between GM and Great-west Multi-manager
Can any of the company-specific risk be diversified away by investing in both GM and Great-west Multi-manager 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 Great-west Multi-manager into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and Great West Multi Manager Large, you can compare the effects of market volatilities on GM and Great-west Multi-manager 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 Great-west Multi-manager. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Great-west Multi-manager.
Diversification Opportunities for GM and Great-west Multi-manager
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GM and Great-west is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Great West Multi Manager Large in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Great-west Multi-manager 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 Great-west Multi-manager. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Great-west Multi-manager has no effect on the direction of GM i.e., GM and Great-west Multi-manager go up and down completely randomly.
Pair Corralation between GM and Great-west Multi-manager
If you would invest 3,331 in General Motors on September 4, 2024 and sell it today you would earn a total of 2,173 from holding General Motors or generate 65.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
General Motors vs. Great West Multi Manager Large
Performance |
| Timeline |
| General Motors |
| Great-west Multi-manager |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
GM and Great-west Multi-manager Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Great-west Multi-manager
The main advantage of trading using opposite GM and Great-west Multi-manager positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Great-west Multi-manager 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 Great-west Multi-manager will offset losses from the drop in Great-west Multi-manager's long position.The idea behind General Motors and Great West Multi Manager Large 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.| Great-west Multi-manager vs. Mirova Global Green | Great-west Multi-manager vs. Franklin Mutual Global | Great-west Multi-manager vs. Legg Mason Global | Great-west Multi-manager vs. Ab Global Risk |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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