Correlation Between GM and Omkar Speciality
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By analyzing existing cross correlation between General Motors and Omkar Speciality Chemicals, you can compare the effects of market volatilities on GM and Omkar Speciality 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 Omkar Speciality. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Omkar Speciality.
Diversification Opportunities for GM and Omkar Speciality
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between GM and Omkar is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Omkar Speciality Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Omkar Speciality Che 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 Omkar Speciality. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Omkar Speciality Che has no effect on the direction of GM i.e., GM and Omkar Speciality go up and down completely randomly.
Pair Corralation between GM and Omkar Speciality
Allowing for the 90-day total investment horizon General Motors is expected to generate 0.62 times more return on investment than Omkar Speciality. However, General Motors is 1.6 times less risky than Omkar Speciality. It trades about 0.07 of its potential returns per unit of risk. Omkar Speciality Chemicals is currently generating about 0.01 per unit of risk. If you would invest 3,889 in General Motors on August 28, 2024 and sell it today you would earn a total of 2,131 from holding General Motors or generate 54.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 91.53% |
| Values | Daily Returns |
General Motors vs. Omkar Speciality Chemicals
Performance |
| Timeline |
| General Motors |
| Omkar Speciality Che |
GM and Omkar Speciality Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Omkar Speciality
The main advantage of trading using opposite GM and Omkar Speciality positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Omkar Speciality 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 Omkar Speciality will offset losses from the drop in Omkar Speciality's long position.The idea behind General Motors and Omkar Speciality Chemicals 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.| Omkar Speciality vs. NMDC Limited | Omkar Speciality vs. Steel Authority of | Omkar Speciality vs. Embassy Office Parks | Omkar Speciality vs. Gujarat Alkalies and |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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