Correlation Between NYSE Composite and GENERAL
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By analyzing existing cross correlation between NYSE Composite and GENERAL ELEC CAP, you can compare the effects of market volatilities on NYSE Composite 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 NYSE Composite with a short position of GENERAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and GENERAL.
Diversification Opportunities for NYSE Composite and GENERAL
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NYSE and GENERAL is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and GENERAL ELEC CAP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GENERAL ELEC CAP and NYSE Composite 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 NYSE Composite 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 ELEC CAP has no effect on the direction of NYSE Composite i.e., NYSE Composite and GENERAL go up and down completely randomly.
Pair Corralation between NYSE Composite and GENERAL
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.47 times more return on investment than GENERAL. However, NYSE Composite is 2.13 times less risky than GENERAL. It trades about 0.42 of its potential returns per unit of risk. GENERAL ELEC CAP is currently generating about -0.12 per unit of risk. If you would invest 1,923,895 in NYSE Composite on September 1, 2024 and sell it today you would earn a total of 103,309 from holding NYSE Composite or generate 5.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 57.14% |
| Values | Daily Returns |
NYSE Composite vs. GENERAL ELEC CAP
Performance |
| Timeline |
NYSE Composite and GENERAL Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
GENERAL ELEC CAP
Pair trading matchups for GENERAL
Pair Trading with NYSE Composite and GENERAL
The main advantage of trading using opposite NYSE Composite and GENERAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite 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.| NYSE Composite vs. Acumen Pharmaceuticals | NYSE Composite vs. Mind Medicine | NYSE Composite vs. NL Industries | NYSE Composite vs. Ecovyst |
| GENERAL vs. Iridium Communications | GENERAL vs. Getty Images Holdings | GENERAL vs. Dave Busters Entertainment | GENERAL vs. KVH Industries |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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