Correlation Between GM and Vascular Biogenics
Can any of the company-specific risk be diversified away by investing in both GM and Vascular Biogenics 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 Vascular Biogenics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and Vascular Biogenics, you can compare the effects of market volatilities on GM and Vascular Biogenics 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 Vascular Biogenics. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Vascular Biogenics.
Diversification Opportunities for GM and Vascular Biogenics
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GM and Vascular is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Vascular Biogenics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vascular Biogenics 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 Vascular Biogenics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vascular Biogenics has no effect on the direction of GM i.e., GM and Vascular Biogenics go up and down completely randomly.
Pair Corralation between GM and Vascular Biogenics
If you would invest 28.00 in Vascular Biogenics on September 14, 2024 and sell it today you would earn a total of 0.00 from holding Vascular Biogenics or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.76% |
| Values | Daily Returns |
General Motors vs. Vascular Biogenics
Performance |
| Timeline |
| General Motors |
| Vascular Biogenics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
GM and Vascular Biogenics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Vascular Biogenics
The main advantage of trading using opposite GM and Vascular Biogenics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Vascular Biogenics 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 Vascular Biogenics will offset losses from the drop in Vascular Biogenics' long position.The idea behind General Motors and Vascular Biogenics 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.| Vascular Biogenics vs. Revelation Biosciences | Vascular Biogenics vs. Zura Bio Limited | Vascular Biogenics vs. Phio Pharmaceuticals Corp | Vascular Biogenics vs. ZyVersa Therapeutics |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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