Correlation Between Nasdaq and GENERAL
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By analyzing existing cross correlation between Nasdaq Inc and GENERAL MTRS 66, you can compare the effects of market volatilities on Nasdaq and GENERAL 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 Nasdaq with a short position of GENERAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nasdaq and GENERAL.
Diversification Opportunities for Nasdaq and GENERAL
Pay attention - limited upside
The 3 months correlation between Nasdaq and GENERAL is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Nasdaq Inc and GENERAL MTRS 66 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GENERAL MTRS 66 and Nasdaq 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 Nasdaq Inc are associated (or correlated) with GENERAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GENERAL MTRS 66 has no effect on the direction of Nasdaq i.e., Nasdaq and GENERAL go up and down completely randomly.
Pair Corralation between Nasdaq and GENERAL
Given the investment horizon of 90 days Nasdaq Inc is expected to generate 0.34 times more return on investment than GENERAL. However, Nasdaq Inc is 2.9 times less risky than GENERAL. It trades about 0.58 of its potential returns per unit of risk. GENERAL MTRS 66 is currently generating about -0.08 per unit of risk. If you would invest 7,432 in Nasdaq Inc on September 2, 2024 and sell it today you would earn a total of 867.00 from holding Nasdaq Inc or generate 11.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nasdaq Inc vs. GENERAL MTRS 66
Performance |
| Timeline |
| Nasdaq Inc |
| GENERAL MTRS 66 |
Nasdaq and GENERAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nasdaq and GENERAL
The main advantage of trading using opposite Nasdaq and GENERAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nasdaq position performs unexpectedly, GENERAL 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 GENERAL will offset losses from the drop in GENERAL's long position.The idea behind Nasdaq Inc and GENERAL MTRS 66 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.| GENERAL vs. Yuexiu Transport Infrastructure | GENERAL vs. Playtika Holding Corp | GENERAL vs. Afya | GENERAL vs. Emerson Radio |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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