Correlation Between GM and 166756AX4
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By analyzing existing cross correlation between General Motors and CVX 42 15 OCT 49, you can compare the effects of market volatilities on GM and 166756AX4 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 166756AX4. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and 166756AX4.
Diversification Opportunities for GM and 166756AX4
Weak diversification
The 3 months correlation between GM and 166756AX4 is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and CVX 42 15 OCT 49 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CVX 42 15 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 166756AX4. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CVX 42 15 has no effect on the direction of GM i.e., GM and 166756AX4 go up and down completely randomly.
Pair Corralation between GM and 166756AX4
Allowing for the 90-day total investment horizon General Motors is expected to generate 0.94 times more return on investment than 166756AX4. However, General Motors is 1.07 times less risky than 166756AX4. It trades about 0.31 of its potential returns per unit of risk. CVX 42 15 OCT 49 is currently generating about -0.14 per unit of risk. If you would invest 5,273 in General Motors on August 28, 2024 and sell it today you would earn a total of 747.00 from holding General Motors or generate 14.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 22.73% |
| Values | Daily Returns |
General Motors vs. CVX 42 15 OCT 49
Performance |
| Timeline |
| General Motors |
| CVX 42 15 |
GM and 166756AX4 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and 166756AX4
The main advantage of trading using opposite GM and 166756AX4 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, 166756AX4 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 166756AX4 will offset losses from the drop in 166756AX4's long position.The idea behind General Motors and CVX 42 15 OCT 49 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.| 166756AX4 vs. Encore Capital Group | 166756AX4 vs. Pintec Technology Holdings | 166756AX4 vs. Juniata Valley Financial | 166756AX4 vs. Digi International |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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