Correlation Between General Mills and General Mills

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

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

Diversification Opportunities for General Mills and General Mills

0.99

Correlation Coefficient

General Mills  General Mills

No risk reduction

The 3 months correlation between General and General is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding General Mills and General Mills in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on General Mills and General Mills 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 Mills are associated (or correlated) with General Mills. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of General Mills has no effect on the direction of General Mills i.e., General Mills and General Mills go up and down completely randomly.

Pair Corralation between General Mills and General Mills

Assuming the 90 days horizon General Mills is expected to under-perform the General Mills. But the stock apears to be less risky and, when comparing its historical volatility, General Mills is 1.08 times less risky than General Mills. The stock trades about -0.18 of its potential returns per unit of risk. The General Mills is currently generating about -0.16 of returns per unit of risk over similar time horizon. If you would invest  4,953  in General Mills on April 23, 2025 and sell it today you would lose (721.00) from holding General Mills or give up 14.56% of portfolio value over 90 days.

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

General Mills  vs.  General Mills

General Mills

Risk-Adjusted Performance

Very Weak

Over the last 90 days General Mills has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in August 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

General Mills

Risk-Adjusted Performance

Very Weak

Over the last 90 days General Mills has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's primary indicators remain comparatively stable which may send shares a bit higher in August 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with General Mills and General Mills

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

The idea behind General Mills and General Mills 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.