Correlation Between General Money and Johnson Opportunity
Can any of the company-specific risk be diversified away by investing in both General Money and Johnson Opportunity 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 General Money and Johnson Opportunity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Money Market and Johnson Opportunity S, you can compare the effects of market volatilities on General Money and Johnson Opportunity 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 General Money with a short position of Johnson Opportunity. Check out your portfolio center. Please also check ongoing floating volatility patterns of General Money and Johnson Opportunity.
Diversification Opportunities for General Money and Johnson Opportunity
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between General and Johnson is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding General Money Market and Johnson Opportunity S in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Johnson Opportunity and General Money 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 Money Market are associated (or correlated) with Johnson Opportunity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Johnson Opportunity has no effect on the direction of General Money i.e., General Money and Johnson Opportunity go up and down completely randomly.
Pair Corralation between General Money and Johnson Opportunity
If you would invest 100.00 in General Money Market on September 13, 2024 and sell it today you would earn a total of 0.00 from holding General Money Market or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
General Money Market vs. Johnson Opportunity S
Performance |
| Timeline |
| General Money Market |
| Johnson Opportunity |
General Money and Johnson Opportunity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with General Money and Johnson Opportunity
The main advantage of trading using opposite General Money and Johnson Opportunity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if General Money position performs unexpectedly, Johnson Opportunity 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 Johnson Opportunity will offset losses from the drop in Johnson Opportunity's long position.| General Money vs. Putnam Money Market | General Money vs. Cref Money Market | General Money vs. Ab Government Exchange | General Money vs. Money Market Obligations |
| Johnson Opportunity vs. Johnson Core Plus | Johnson Opportunity vs. Johnson Enhanced Return | Johnson Opportunity vs. Johnson Equity Income | Johnson Opportunity vs. Johnson Mutual Funds |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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