Correlation Between GM and SMBCAC
Specify exactly 2 symbols:
By analyzing existing cross correlation between General Motors and SMBCAC 19 15 OCT 26, you can compare the effects of market volatilities on GM and SMBCAC 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 SMBCAC. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and SMBCAC.
Diversification Opportunities for GM and SMBCAC
Very weak diversification
The 3 months correlation between GM and SMBCAC is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and SMBCAC 19 15 OCT 26 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SMBCAC 19 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 SMBCAC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SMBCAC 19 15 has no effect on the direction of GM i.e., GM and SMBCAC go up and down completely randomly.
Pair Corralation between GM and SMBCAC
Allowing for the 90-day total investment horizon General Motors is expected to generate 1.01 times more return on investment than SMBCAC. However, GM is 1.01 times more volatile than SMBCAC 19 15 OCT 26. It trades about 0.32 of its potential returns per unit of risk. SMBCAC 19 15 OCT 26 is currently generating about -0.62 per unit of risk. If you would invest 5,273 in General Motors on August 27, 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 | Weak |
| Accuracy | 14.29% |
| Values | Daily Returns |
General Motors vs. SMBCAC 19 15 OCT 26
Performance |
| Timeline |
| General Motors |
| SMBCAC 19 15 |
GM and SMBCAC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and SMBCAC
The main advantage of trading using opposite GM and SMBCAC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, SMBCAC 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 SMBCAC will offset losses from the drop in SMBCAC's long position.The idea behind General Motors and SMBCAC 19 15 OCT 26 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.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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |