Correlation Between GM and 37045XEB8
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By analyzing existing cross correlation between General Motors and GM 6 09 JAN 28, you can compare the effects of market volatilities on GM and 37045XEB8 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 37045XEB8. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and 37045XEB8.
Diversification Opportunities for GM and 37045XEB8
Very weak diversification
The 3 months correlation between GM and 37045XEB8 is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and GM 6 09 JAN 28 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 37045XEB8 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 37045XEB8. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 37045XEB8 has no effect on the direction of GM i.e., GM and 37045XEB8 go up and down completely randomly.
Pair Corralation between GM and 37045XEB8
Allowing for the 90-day total investment horizon General Motors is expected to under-perform the 37045XEB8. In addition to that, GM is 19.47 times more volatile than GM 6 09 JAN 28. It trades about -0.22 of its total potential returns per unit of risk. GM 6 09 JAN 28 is currently generating about -0.09 per unit of volatility. If you would invest 10,291 in GM 6 09 JAN 28 on November 28, 2024 and sell it today you would lose (24.00) from holding GM 6 09 JAN 28 or give up 0.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
General Motors vs. GM 6 09 JAN 28
Performance |
| Timeline |
| General Motors |
| 37045XEB8 |
GM and 37045XEB8 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and 37045XEB8
The main advantage of trading using opposite GM and 37045XEB8 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, 37045XEB8 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 37045XEB8 will offset losses from the drop in 37045XEB8's long position.The idea behind General Motors and GM 6 09 JAN 28 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.| 37045XEB8 vs. Sealed Air | 37045XEB8 vs. Delek Logistics Partners | 37045XEB8 vs. GMxico Transportes SAB | 37045XEB8 vs. PPG Industries |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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