Correlation Between GM and Oppenheimer Global
Can any of the company-specific risk be diversified away by investing in both GM and Oppenheimer 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 Oppenheimer 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 Oppenheimer Global Gr, you can compare the effects of market volatilities on GM and Oppenheimer 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 Oppenheimer Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Oppenheimer Global.
Diversification Opportunities for GM and Oppenheimer Global
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GM and Oppenheimer is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Oppenheimer Global Gr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oppenheimer Global 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 Oppenheimer Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oppenheimer Global has no effect on the direction of GM i.e., GM and Oppenheimer Global go up and down completely randomly.
Pair Corralation between GM and Oppenheimer Global
Allowing for the 90-day total investment horizon General Motors is expected to generate 2.26 times more return on investment than Oppenheimer Global. However, GM is 2.26 times more volatile than Oppenheimer Global Gr. It trades about 0.08 of its potential returns per unit of risk. Oppenheimer Global Gr is currently generating about 0.02 per unit of risk. If you would invest 4,411 in General Motors on September 3, 2024 and sell it today you would earn a total of 1,148 from holding General Motors or generate 26.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
General Motors vs. Oppenheimer Global Gr
Performance |
| Timeline |
| General Motors |
| Oppenheimer Global |
GM and Oppenheimer Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Oppenheimer Global
The main advantage of trading using opposite GM and Oppenheimer Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Oppenheimer 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 Oppenheimer Global will offset losses from the drop in Oppenheimer Global's long position.The idea behind General Motors and Oppenheimer Global Gr 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.| Oppenheimer Global vs. Nuveen High Income | Oppenheimer Global vs. Ab High Income | Oppenheimer Global vs. Calvert High Yield | Oppenheimer Global vs. Guggenheim High Yield |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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