Correlation Between Genuine Parts and 1847 Goedeker

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Can any of the company-specific risk be diversified away by investing in both Genuine Parts and 1847 Goedeker 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 Genuine Parts and 1847 Goedeker into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genuine Parts and 1847 Goedeker Inc, you can compare the effects of market volatilities on Genuine Parts and 1847 Goedeker 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 Genuine Parts with a short position of 1847 Goedeker. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genuine Parts and 1847 Goedeker.

Diversification Opportunities for Genuine Parts and 1847 Goedeker

-0.87
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Genuine and 1847 Goedeker is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Genuine Parts and 1847 Goedeker Inc Commom Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 1847 Goedeker Commom and Genuine Parts 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 Genuine Parts are associated (or correlated) with 1847 Goedeker. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 1847 Goedeker Commom has no effect on the direction of Genuine Parts i.e., Genuine Parts and 1847 Goedeker go up and down completely randomly.

Pair Corralation between Genuine Parts and 1847 Goedeker

Considering the 90-day investment horizon Genuine Parts is expected to generate 0.29 times more return on investment than 1847 Goedeker. However, Genuine Parts is 3.4 times less risky than 1847 Goedeker. It trades about 0.09 of its potential returns per unit of risk. 1847 Goedeker Inc is currently generating about -0.07 per unit of risk. If you would invest  12,940  in Genuine Parts on September 1, 2022 and sell it today you would earn a total of  5,066  from holding Genuine Parts or generate 39.15% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthSignificant
Accuracy80.32%
ValuesDaily Returns

Genuine Parts  vs.  1847 Goedeker Inc Commom Stock

 Performance (%) 
       Timeline  
Genuine Parts 
Genuine Performance
11 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Genuine Parts are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Genuine Parts sustained solid returns over the last few months and may actually be approaching a breakup point.

Genuine Price Channel

1847 Goedeker Commom 
1847 Goedeker Performance
0 of 100
Over the last 90 days 1847 Goedeker Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather weak technical and fundamental indicators, 1847 Goedeker exhibited solid returns over the last few months and may actually be approaching a breakup point.

Genuine Parts and 1847 Goedeker Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Genuine Parts and 1847 Goedeker

The main advantage of trading using opposite Genuine Parts and 1847 Goedeker positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genuine Parts position performs unexpectedly, 1847 Goedeker 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 1847 Goedeker will offset losses from the drop in 1847 Goedeker's long position.
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The idea behind Genuine Parts and 1847 Goedeker Inc 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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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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.

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