Correlation Between GENERAL and Cintas
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By analyzing existing cross correlation between GENERAL ELEC CAP and Cintas, you can compare the effects of market volatilities on GENERAL and Cintas 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 GENERAL with a short position of Cintas. Check out your portfolio center. Please also check ongoing floating volatility patterns of GENERAL and Cintas.
Diversification Opportunities for GENERAL and Cintas
Good diversification
The 3 months correlation between GENERAL and Cintas is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding GENERAL ELEC CAP and Cintas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cintas and GENERAL 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 GENERAL ELEC CAP are associated (or correlated) with Cintas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cintas has no effect on the direction of GENERAL i.e., GENERAL and Cintas go up and down completely randomly.
Pair Corralation between GENERAL and Cintas
Assuming the 90 days trading horizon GENERAL is expected to generate 8.56 times less return on investment than Cintas. In addition to that, GENERAL is 1.4 times more volatile than Cintas. It trades about 0.01 of its total potential returns per unit of risk. Cintas is currently generating about 0.1 per unit of volatility. If you would invest 10,997 in Cintas on November 2, 2024 and sell it today you would earn a total of 9,221 from holding Cintas or generate 83.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 49.19% |
| Values | Daily Returns |
GENERAL ELEC CAP vs. Cintas
Performance |
| Timeline |
| GENERAL ELEC CAP |
| Cintas |
GENERAL and Cintas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GENERAL and Cintas
The main advantage of trading using opposite GENERAL and Cintas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GENERAL position performs unexpectedly, Cintas 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 Cintas will offset losses from the drop in Cintas' long position.| GENERAL vs. Westinghouse Air Brake | GENERAL vs. Mesa Air Group | GENERAL vs. Target Hospitality Corp | GENERAL vs. Grupo Aeroportuario del |
| Cintas vs. ABM Industries Incorporated | Cintas vs. Copart Inc | Cintas vs. Dolby Laboratories | Cintas vs. Relx PLC ADR |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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