Correlation Between 00108WAF7 and GE Aerospace
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By analyzing existing cross correlation between AEP TEX INC and GE Aerospace, you can compare the effects of market volatilities on 00108WAF7 and GE Aerospace 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 00108WAF7 with a short position of GE Aerospace. Check out your portfolio center. Please also check ongoing floating volatility patterns of 00108WAF7 and GE Aerospace.
Diversification Opportunities for 00108WAF7 and GE Aerospace
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between 00108WAF7 and GE Aerospace is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding AEP TEX INC and GE Aerospace in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GE Aerospace and 00108WAF7 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 AEP TEX INC are associated (or correlated) with GE Aerospace. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GE Aerospace has no effect on the direction of 00108WAF7 i.e., 00108WAF7 and GE Aerospace go up and down completely randomly.
Pair Corralation between 00108WAF7 and GE Aerospace
Assuming the 90 days trading horizon AEP TEX INC is expected to generate 80.41 times more return on investment than GE Aerospace. However, 00108WAF7 is 80.41 times more volatile than GE Aerospace. It trades about 0.13 of its potential returns per unit of risk. GE Aerospace is currently generating about 0.15 per unit of risk. If you would invest 7,682 in AEP TEX INC on August 24, 2024 and sell it today you would earn a total of 539.00 from holding AEP TEX INC or generate 7.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 62.7% |
| Values | Daily Returns |
AEP TEX INC vs. GE Aerospace
Performance |
| Timeline |
| AEP TEX INC |
| GE Aerospace |
00108WAF7 and GE Aerospace Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 00108WAF7 and GE Aerospace
The main advantage of trading using opposite 00108WAF7 and GE Aerospace positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 00108WAF7 position performs unexpectedly, GE Aerospace 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 Aerospace will offset losses from the drop in GE Aerospace's long position.| 00108WAF7 vs. Willamette Valley Vineyards | 00108WAF7 vs. National Beverage Corp | 00108WAF7 vs. Mesa Air Group | 00108WAF7 vs. Diageo PLC ADR |
| GE Aerospace vs. Illinois Tool Works | GE Aerospace vs. Dover | GE Aerospace vs. Cummins | GE Aerospace vs. Eaton PLC |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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