Correlation Between Barclays Capital and GE Aerospace
Can any of the company-specific risk be diversified away by investing in both Barclays Capital and GE Aerospace 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 Barclays Capital and GE Aerospace into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barclays Capital and GE Aerospace, you can compare the effects of market volatilities on Barclays Capital 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 Barclays Capital with a short position of GE Aerospace. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barclays Capital and GE Aerospace.
Diversification Opportunities for Barclays Capital and GE Aerospace
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Barclays and GE Aerospace is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Barclays Capital and GE Aerospace in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GE Aerospace and Barclays Capital 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 Barclays Capital 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 Barclays Capital i.e., Barclays Capital and GE Aerospace go up and down completely randomly.
Pair Corralation between Barclays Capital and GE Aerospace
If you would invest 9,098 in GE Aerospace on January 24, 2024 and sell it today you would earn a total of 5,921 from holding GE Aerospace or generate 65.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 0.54% |
| Values | Daily Returns |
Barclays Capital vs. GE Aerospace
Performance |
| Timeline |
| Barclays Capital |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| GE Aerospace |
Barclays Capital and GE Aerospace Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barclays Capital and GE Aerospace
The main advantage of trading using opposite Barclays Capital and GE Aerospace positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barclays Capital 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.| Barclays Capital vs. Vanguard Total Stock | Barclays Capital vs. SPDR SP 500 | Barclays Capital vs. iShares Core SP | Barclays Capital vs. Vanguard Total Bond |
| GE Aerospace vs. Parker Hannifin | GE Aerospace vs. Emerson Electric | GE Aerospace vs. Smith AO | GE Aerospace vs. Oshidori International Holdings |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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