Correlation Between GM and PLNIJ
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By analyzing existing cross correlation between General Motors and PLNIJ 4125 15 MAY 27, you can compare the effects of market volatilities on GM and PLNIJ 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 PLNIJ. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and PLNIJ.
Diversification Opportunities for GM and PLNIJ
Poor diversification
The 3 months correlation between GM and PLNIJ is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and PLNIJ 4125 15 MAY 27 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PLNIJ 4125 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 PLNIJ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PLNIJ 4125 15 has no effect on the direction of GM i.e., GM and PLNIJ go up and down completely randomly.
Pair Corralation between GM and PLNIJ
Allowing for the 90-day total investment horizon General Motors is expected to generate 3.29 times more return on investment than PLNIJ. However, GM is 3.29 times more volatile than PLNIJ 4125 15 MAY 27. It trades about 0.16 of its potential returns per unit of risk. PLNIJ 4125 15 MAY 27 is currently generating about -0.4 per unit of risk. If you would invest 4,893 in General Motors on August 28, 2024 and sell it today you would earn a total of 1,127 from holding General Motors or generate 23.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 20.63% |
| Values | Daily Returns |
General Motors vs. PLNIJ 4125 15 MAY 27
Performance |
| Timeline |
| General Motors |
| PLNIJ 4125 15 |
GM and PLNIJ Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and PLNIJ
The main advantage of trading using opposite GM and PLNIJ positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, PLNIJ 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 PLNIJ will offset losses from the drop in PLNIJ's long position.The idea behind General Motors and PLNIJ 4125 15 MAY 27 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.| PLNIJ vs. GoHealth | PLNIJ vs. Assurant | PLNIJ vs. Pekin Life Insurance | PLNIJ vs. Willamette Valley Vineyards |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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