Correlation Between Qualigen Therapeutics and GM

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

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

Diversification Opportunities for Qualigen Therapeutics and GM

-0.7

Correlation Coefficient

Qualigen Therapeutics  GM

Excellent diversification

The 3 months correlation between Qualigen and GM is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Qualigen Therapeutics and General Motors in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on General Motors and Qualigen Therapeutics 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 Qualigen Therapeutics are associated (or correlated) with GM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of General Motors has no effect on the direction of Qualigen Therapeutics i.e., Qualigen Therapeutics and GM go up and down completely randomly.

Pair Corralation between Qualigen Therapeutics and GM

Given the investment horizon of 90 days Qualigen Therapeutics is expected to under-perform the GM. In addition to that, Qualigen Therapeutics is 2.64 times more volatile than General Motors. It trades about -0.16 of its total potential returns per unit of risk. General Motors is currently generating about 0.21 per unit of volatility. If you would invest  3,448  in General Motors on January 18, 2024 and sell it today you would earn a total of  798.00  from holding General Motors or generate 23.14% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Qualigen Therapeutics  vs.  General Motors

Qualigen Therapeutics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Qualigen Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in May 2024. The recent disarray may also be a sign of long period up-swing for the firm investors.

General Motors

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in General Motors are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of very weak primary indicators, GM displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Qualigen Therapeutics and GM

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

The idea behind Qualigen Therapeutics and General Motors 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.