Correlation Between GM and US Commodity
Can any of the company-specific risk be diversified away by investing in both GM and US Commodity at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining GM and US Commodity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and US Commodity Funds, you can compare the effects of market volatilities on GM and US Commodity 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 US Commodity. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and US Commodity.
Diversification Opportunities for GM and US Commodity
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GM and USOU is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and US Commodity Funds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on US Commodity Funds 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 US Commodity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of US Commodity Funds has no effect on the direction of GM i.e., GM and US Commodity go up and down completely randomly.
Pair Corralation between GM and US Commodity
If you would invest 5,180 in General Motors on September 4, 2024 and sell it today you would earn a total of 324.00 from holding General Motors or generate 6.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
General Motors vs. US Commodity Funds
Performance |
| Timeline |
| General Motors |
| US Commodity Funds |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
GM and US Commodity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and US Commodity
The main advantage of trading using opposite GM and US Commodity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, US Commodity 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 US Commodity will offset losses from the drop in US Commodity's long position.The idea behind General Motors and US Commodity Funds 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.| US Commodity vs. FT Vest Equity | US Commodity vs. Zillow Group Class | US Commodity vs. Northern Lights | US Commodity vs. VanEck Vectors Moodys |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |