Correlation Between GM and OptiBiotix Health
Can any of the company-specific risk be diversified away by investing in both GM and OptiBiotix Health 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 OptiBiotix Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and OptiBiotix Health Plc, you can compare the effects of market volatilities on GM and OptiBiotix Health 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 OptiBiotix Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and OptiBiotix Health.
Diversification Opportunities for GM and OptiBiotix Health
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GM and OptiBiotix is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and OptiBiotix Health Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OptiBiotix Health Plc 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 OptiBiotix Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OptiBiotix Health Plc has no effect on the direction of GM i.e., GM and OptiBiotix Health go up and down completely randomly.
Pair Corralation between GM and OptiBiotix Health
Allowing for the 90-day total investment horizon General Motors is expected to generate 0.42 times more return on investment than OptiBiotix Health. However, General Motors is 2.38 times less risky than OptiBiotix Health. It trades about 0.08 of its potential returns per unit of risk. OptiBiotix Health Plc is currently generating about -0.01 per unit of risk. If you would invest 2,873 in General Motors on November 28, 2024 and sell it today you would earn a total of 1,798 from holding General Motors or generate 62.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 98.49% |
| Values | Daily Returns |
General Motors vs. OptiBiotix Health Plc
Performance |
| Timeline |
| General Motors |
| OptiBiotix Health Plc |
GM and OptiBiotix Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and OptiBiotix Health
The main advantage of trading using opposite GM and OptiBiotix Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, OptiBiotix Health 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 OptiBiotix Health will offset losses from the drop in OptiBiotix Health's long position.The idea behind General Motors and OptiBiotix Health Plc 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.| OptiBiotix Health vs. Fresenius Medical Care | OptiBiotix Health vs. Teradata Corp | OptiBiotix Health vs. JB Hunt Transport | OptiBiotix Health vs. Rosslyn Data Technologies |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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