Correlation Between GM and Allianzgi Nfj
Can any of the company-specific risk be diversified away by investing in both GM and Allianzgi Nfj 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 Allianzgi Nfj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and Allianzgi Nfj Small Cap, you can compare the effects of market volatilities on GM and Allianzgi Nfj 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 Allianzgi Nfj. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Allianzgi Nfj.
Diversification Opportunities for GM and Allianzgi Nfj
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GM and Allianzgi is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Allianzgi Nfj Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianzgi Nfj Small 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 Allianzgi Nfj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianzgi Nfj Small has no effect on the direction of GM i.e., GM and Allianzgi Nfj go up and down completely randomly.
Pair Corralation between GM and Allianzgi Nfj
Allowing for the 90-day total investment horizon General Motors is expected to under-perform the Allianzgi Nfj. In addition to that, GM is 2.55 times more volatile than Allianzgi Nfj Small Cap. It trades about -0.32 of its total potential returns per unit of risk. Allianzgi Nfj Small Cap is currently generating about -0.3 per unit of volatility. If you would invest 1,629 in Allianzgi Nfj Small Cap on November 28, 2024 and sell it today you would lose (92.00) from holding Allianzgi Nfj Small Cap or give up 5.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
General Motors vs. Allianzgi Nfj Small Cap
Performance |
| Timeline |
| General Motors |
| Allianzgi Nfj Small |
GM and Allianzgi Nfj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Allianzgi Nfj
The main advantage of trading using opposite GM and Allianzgi Nfj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Allianzgi Nfj 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 Allianzgi Nfj will offset losses from the drop in Allianzgi Nfj's long position.The idea behind General Motors and Allianzgi Nfj Small Cap 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.| Allianzgi Nfj vs. Vanguard Intermediate Term Government | Allianzgi Nfj vs. Virtus Seix Government | Allianzgi Nfj vs. Franklin Adjustable Government | Allianzgi Nfj vs. Dunham Porategovernment Bond |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |