Correlation Between GM and Southside Bancshares,

Can any of the company-specific risk be diversified away by investing in both GM and Southside Bancshares, 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 GM and Southside Bancshares, into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between General Motors and Southside Bancshares,, you can compare the effects of market volatilities on GM and Southside Bancshares, 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 GM with a short position of Southside Bancshares,. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Southside Bancshares,.

Diversification Opportunities for GM and Southside Bancshares,

0.7

Correlation Coefficient

GM  Southside Bancshares,

Poor diversification

The 3 months correlation between GM and Southside is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Southside Bancshares, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Southside Bancshares, and GM 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 Motors are associated (or correlated) with Southside Bancshares,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Southside Bancshares, has no effect on the direction of GM i.e., GM and Southside Bancshares, go up and down completely randomly.

Pair Corralation between GM and Southside Bancshares,

Allowing for the 90-day total investment horizon General Motors is expected to generate 0.82 times more return on investment than Southside Bancshares,. However, General Motors is 1.22 times less risky than Southside Bancshares,. It trades about -0.12 of its potential returns per unit of risk. Southside Bancshares, is currently generating about -0.25 per unit of risk. If you would invest  5,538  in General Motors on September 28, 2024 and sell it today you would lose (187.00) from holding General Motors or give up 3.38% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

General Motors  vs.  Southside Bancshares,

General Motors

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in General Motors are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very weak primary indicators, GM displayed solid returns over the last few months and may actually be approaching a breakup point.

Southside Bancshares,

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Southside Bancshares, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Southside Bancshares, is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with GM and Southside Bancshares,

The main advantage of trading using opposite GM and Southside Bancshares, positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Southside Bancshares, 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 Southside Bancshares, will offset losses from the drop in Southside Bancshares,'s long position.

The idea behind General Motors and Southside Bancshares, 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.

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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.