Correlation Between Great West and Bny Mellon
Can any of the company-specific risk be diversified away by investing in both Great West and Bny Mellon 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 Great West and Bny Mellon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Great West Loomis Sayles and Bny Mellon Small, you can compare the effects of market volatilities on Great West and Bny Mellon 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 Great West with a short position of Bny Mellon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Great West and Bny Mellon.
Diversification Opportunities for Great West and Bny Mellon
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Great and Bny is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Great West Loomis Sayles and Bny Mellon Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bny Mellon Small and Great West 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 Great West Loomis Sayles are associated (or correlated) with Bny Mellon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bny Mellon Small has no effect on the direction of Great West i.e., Great West and Bny Mellon go up and down completely randomly.
Pair Corralation between Great West and Bny Mellon
Assuming the 90 days horizon Great West is expected to generate 1.19 times less return on investment than Bny Mellon. In addition to that, Great West is 1.03 times more volatile than Bny Mellon Small. It trades about 0.04 of its total potential returns per unit of risk. Bny Mellon Small is currently generating about 0.05 per unit of volatility. If you would invest 1,841 in Bny Mellon Small on September 14, 2024 and sell it today you would earn a total of 276.00 from holding Bny Mellon Small or generate 14.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Great West Loomis Sayles vs. Bny Mellon Small
Performance |
| Timeline |
| Great West Loomis |
| Bny Mellon Small |
Great West and Bny Mellon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Great West and Bny Mellon
The main advantage of trading using opposite Great West and Bny Mellon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Great West position performs unexpectedly, Bny Mellon 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 Bny Mellon will offset losses from the drop in Bny Mellon's long position.| Great West vs. Vanguard Health Care | Great West vs. Baron Health Care | Great West vs. Invesco Global Health | Great West vs. Delaware Healthcare Fund |
| Bny Mellon vs. Bny Mellon Massachusetts | Bny Mellon vs. Bny Mellon Massachusetts | Bny Mellon vs. Bny Mellon New | Bny Mellon vs. Bny Mellon New |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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