Correlation Between GM and AMUNDI MSCI
Can any of the company-specific risk be diversified away by investing in both GM and AMUNDI MSCI 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 AMUNDI MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and AMUNDI MSCI North, you can compare the effects of market volatilities on GM and AMUNDI MSCI 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 AMUNDI MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and AMUNDI MSCI.
Diversification Opportunities for GM and AMUNDI MSCI
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between GM and AMUNDI is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and AMUNDI MSCI North in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMUNDI MSCI North 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 AMUNDI MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMUNDI MSCI North has no effect on the direction of GM i.e., GM and AMUNDI MSCI go up and down completely randomly.
Pair Corralation between GM and AMUNDI MSCI
Allowing for the 90-day total investment horizon GM is expected to generate 2.33 times less return on investment than AMUNDI MSCI. In addition to that, GM is 2.63 times more volatile than AMUNDI MSCI North. It trades about 0.06 of its total potential returns per unit of risk. AMUNDI MSCI North is currently generating about 0.38 per unit of volatility. If you would invest 14,135 in AMUNDI MSCI North on September 5, 2024 and sell it today you would earn a total of 1,358 from holding AMUNDI MSCI North or generate 9.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
General Motors vs. AMUNDI MSCI North
Performance |
| Timeline |
| General Motors |
| AMUNDI MSCI North |
GM and AMUNDI MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and AMUNDI MSCI
The main advantage of trading using opposite GM and AMUNDI MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, AMUNDI MSCI 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 AMUNDI MSCI will offset losses from the drop in AMUNDI MSCI's long position.The idea behind General Motors and AMUNDI MSCI North 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.| AMUNDI MSCI vs. Amundi Index Solutions | AMUNDI MSCI vs. Amundi ETF MSCI | AMUNDI MSCI vs. Amundi Index Solutions | AMUNDI MSCI vs. AMUNDI MSCI USA |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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