Correlation Between GM and Rigel Resource
Can any of the company-specific risk be diversified away by investing in both GM and Rigel Resource 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 Rigel Resource into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and Rigel Resource Acquisition, you can compare the effects of market volatilities on GM and Rigel Resource 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 Rigel Resource. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Rigel Resource.
Diversification Opportunities for GM and Rigel Resource
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GM and Rigel is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Rigel Resource Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rigel Resource Acqui 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 Rigel Resource. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rigel Resource Acqui has no effect on the direction of GM i.e., GM and Rigel Resource go up and down completely randomly.
Pair Corralation between GM and Rigel Resource
If you would invest 5,180 in General Motors on September 3, 2024 and sell it today you would earn a total of 324.00 from holding General Motors or generate 6.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 35.0% |
| Values | Daily Returns |
General Motors vs. Rigel Resource Acquisition
Performance |
| Timeline |
| General Motors |
| Rigel Resource Acqui |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
GM and Rigel Resource Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Rigel Resource
The main advantage of trading using opposite GM and Rigel Resource positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Rigel Resource 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 Rigel Resource will offset losses from the drop in Rigel Resource's long position.The idea behind General Motors and Rigel Resource Acquisition 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.| Rigel Resource vs. Pyrophyte Acquisition Corp | Rigel Resource vs. Cartesian Growth | Rigel Resource vs. Oak Woods Acquisition | Rigel Resource vs. Global Blockchain Acquisition |
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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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