Correlation Between Natural Alternatives and GE Vernova
Can any of the company-specific risk be diversified away by investing in both Natural Alternatives and GE Vernova 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 Natural Alternatives and GE Vernova into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Natural Alternatives International and GE Vernova LLC, you can compare the effects of market volatilities on Natural Alternatives and GE Vernova 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 Natural Alternatives with a short position of GE Vernova. Check out your portfolio center. Please also check ongoing floating volatility patterns of Natural Alternatives and GE Vernova.
Diversification Opportunities for Natural Alternatives and GE Vernova
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Natural and GEV is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Natural Alternatives Internati and GE Vernova LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GE Vernova LLC and Natural Alternatives 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 Natural Alternatives International are associated (or correlated) with GE Vernova. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GE Vernova LLC has no effect on the direction of Natural Alternatives i.e., Natural Alternatives and GE Vernova go up and down completely randomly.
Pair Corralation between Natural Alternatives and GE Vernova
Given the investment horizon of 90 days Natural Alternatives is expected to generate 9.27 times less return on investment than GE Vernova. But when comparing it to its historical volatility, Natural Alternatives International is 1.27 times less risky than GE Vernova. It trades about 0.02 of its potential returns per unit of risk. GE Vernova LLC is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 29,546 in GE Vernova LLC on September 4, 2024 and sell it today you would earn a total of 3,646 from holding GE Vernova LLC or generate 12.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Natural Alternatives Internati vs. GE Vernova LLC
Performance |
| Timeline |
| Natural Alternatives |
| GE Vernova LLC |
Natural Alternatives and GE Vernova Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Natural Alternatives and GE Vernova
The main advantage of trading using opposite Natural Alternatives and GE Vernova positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Natural Alternatives position performs unexpectedly, GE Vernova 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 GE Vernova will offset losses from the drop in GE Vernova's long position.| Natural Alternatives vs. FitLife Brands, Common | Natural Alternatives vs. Lifeway Foods | Natural Alternatives vs. Else Nutrition Holdings | Natural Alternatives vs. Central Garden Pet |
| GE Vernova vs. Natural Alternatives International | GE Vernova vs. Turning Point Brands | GE Vernova vs. BBB Foods | GE Vernova vs. Ispire Technology Common |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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