Correlation Between Bird Global and GATX

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

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

Diversification Opportunities for Bird Global and GATX

-0.7

Correlation Coefficient

Bird Global  GATX

Excellent diversification

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

Pair Corralation between Bird Global and GATX

If you would invest  6.50  in Bird Global on January 24, 2024 and sell it today you would earn a total of  0.00  from holding Bird Global or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	5.0%
Values	Daily Returns

Bird Global  vs.  GATX Corp.

Bird Global

Risk-Adjusted Performance

0 of 100

OK

Over the last 90 days Bird Global has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively weak fundamental indicators, Bird Global unveiled solid returns over the last few months and may actually be approaching a breakup point.

GATX

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in GATX Corporation are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, GATX is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Bird Global and GATX

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

The idea behind Bird Global and GATX Corporation 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.