Correlation Between GM and Septerna, Common

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

By analyzing existing cross correlation between General Motors and Septerna, Common Stock, you can compare the effects of market volatilities on GM and Septerna, Common 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 Septerna, Common. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Septerna, Common.

Diversification Opportunities for GM and Septerna, Common

-0.13

Correlation Coefficient

GM  Septerna, Common

Good diversification

The 3 months correlation between GM and Septerna, is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Septerna, Common Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Septerna, Common Stock 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 Septerna, Common. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Septerna, Common Stock has no effect on the direction of GM i.e., GM and Septerna, Common go up and down completely randomly.

Pair Corralation between GM and Septerna, Common

Allowing for the 90-day total investment horizon GM is expected to generate 5.86 times less return on investment than Septerna, Common. But when comparing it to its historical volatility, General Motors is 2.32 times less risky than Septerna, Common. It trades about 0.06 of its potential returns per unit of risk. Septerna, Common Stock is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  1,800  in Septerna, Common Stock on September 24, 2024 and sell it today you would earn a total of  628.00  from holding Septerna, Common Stock or generate 34.89% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	64.62%
Values	Daily Returns

General Motors  vs.  Septerna, Common Stock

General Motors

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in General Motors are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very weak primary indicators, GM may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Septerna, Common Stock

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Septerna, Common Stock are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Septerna, Common displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GM and Septerna, Common

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

The idea behind General Motors and Septerna, Common Stock 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.

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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.