Correlation Between GM and Picanol Nv
Can any of the company-specific risk be diversified away by investing in both GM and Picanol Nv 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 Picanol Nv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and Picanol Nv, you can compare the effects of market volatilities on GM and Picanol Nv 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 Picanol Nv. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Picanol Nv.
Diversification Opportunities for GM and Picanol Nv
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GM and Picanol is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Picanol Nv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Picanol Nv 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 Picanol Nv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Picanol Nv has no effect on the direction of GM i.e., GM and Picanol Nv go up and down completely randomly.
Pair Corralation between GM and Picanol Nv
If you would invest 5,076 in General Motors on September 1, 2024 and sell it today you would earn a total of 483.00 from holding General Motors or generate 9.52% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
General Motors vs. Picanol Nv
Performance |
Timeline |
General Motors |
Picanol Nv |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
GM and Picanol Nv Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with GM and Picanol Nv
The main advantage of trading using opposite GM and Picanol Nv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Picanol Nv 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 Picanol Nv will offset losses from the drop in Picanol Nv's long position.The idea behind General Motors and Picanol Nv 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.Picanol Nv vs. Vastned Retail Belgium | Picanol Nv vs. Ion Beam Applications | Picanol Nv vs. Retail Estates | Picanol Nv vs. Home Invest Belgium |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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