Correlation Between GM and Janus Forty

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

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

Diversification Opportunities for GM and Janus Forty

0.73

Correlation Coefficient

GM  Janus Forty

Poor diversification

The 3 months correlation between GM and Janus is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Janus Forty Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Janus Forty Fund 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 Janus Forty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Janus Forty Fund has no effect on the direction of GM i.e., GM and Janus Forty go up and down completely randomly.

Pair Corralation between GM and Janus Forty

Allowing for the 90-day total investment horizon GM is expected to generate 1.0 times less return on investment than Janus Forty. In addition to that, GM is 2.44 times more volatile than Janus Forty Fund. It trades about 0.12 of its total potential returns per unit of risk. Janus Forty Fund is currently generating about 0.3 per unit of volatility. If you would invest  3,367  in Janus Forty Fund on May 6, 2025 and sell it today you would earn a total of  616.00  from holding Janus Forty Fund or generate 18.3% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.41%
Values	Daily Returns

General Motors  vs.  Janus Forty Fund

General Motors

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in General Motors are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile primary indicators, GM displayed solid returns over the last few months and may actually be approaching a breakup point.

Janus Forty Fund

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Janus Forty Fund are ranked lower than 23 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Janus Forty showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GM and Janus Forty

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

The idea behind General Motors and Janus Forty Fund 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..