Correlation Between GM and CORNING
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By analyzing existing cross correlation between General Motors and CORNING INC 585, you can compare the effects of market volatilities on GM and CORNING 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 CORNING. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and CORNING.
Diversification Opportunities for GM and CORNING
Excellent diversification
The 3 months correlation between GM and CORNING is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and CORNING INC 585 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CORNING INC 585 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 CORNING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CORNING INC 585 has no effect on the direction of GM i.e., GM and CORNING go up and down completely randomly.
Pair Corralation between GM and CORNING
Allowing for the 90-day total investment horizon General Motors is expected to generate 1.33 times more return on investment than CORNING. However, GM is 1.33 times more volatile than CORNING INC 585. It trades about 0.16 of its potential returns per unit of risk. CORNING INC 585 is currently generating about 0.02 per unit of risk. If you would invest 5,096 in General Motors on September 2, 2024 and sell it today you would earn a total of 463.00 from holding General Motors or generate 9.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 80.95% |
| Values | Daily Returns |
General Motors vs. CORNING INC 585
Performance |
| Timeline |
| General Motors |
| CORNING INC 585 |
GM and CORNING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and CORNING
The main advantage of trading using opposite GM and CORNING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, CORNING 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 CORNING will offset losses from the drop in CORNING's long position.The idea behind General Motors and CORNING INC 585 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.| CORNING vs. AEP TEX INC | CORNING vs. US BANK NATIONAL | CORNING vs. Bank of America | CORNING vs. GE Aerospace |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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