Correlation Between GE Aerospace and FTC Solar
Can any of the company-specific risk be diversified away by investing in both GE Aerospace and FTC Solar 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 GE Aerospace and FTC Solar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GE Aerospace and FTC Solar, you can compare the effects of market volatilities on GE Aerospace and FTC Solar 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 GE Aerospace with a short position of FTC Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Aerospace and FTC Solar.
Diversification Opportunities for GE Aerospace and FTC Solar
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between GE Aerospace and FTC is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding GE Aerospace and FTC Solar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FTC Solar and GE Aerospace 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 GE Aerospace are associated (or correlated) with FTC Solar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FTC Solar has no effect on the direction of GE Aerospace i.e., GE Aerospace and FTC Solar go up and down completely randomly.
Pair Corralation between GE Aerospace and FTC Solar
Allowing for the 90-day total investment horizon GE Aerospace is expected to generate 4.06 times less return on investment than FTC Solar. But when comparing it to its historical volatility, GE Aerospace is 4.05 times less risky than FTC Solar. It trades about 0.19 of its potential returns per unit of risk. FTC Solar is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 481.00 in FTC Solar on August 13, 2025 and sell it today you would earn a total of 346.00 from holding FTC Solar or generate 71.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
GE Aerospace vs. FTC Solar
Performance |
| Timeline |
| GE Aerospace |
| FTC Solar |
GE Aerospace and FTC Solar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GE Aerospace and FTC Solar
The main advantage of trading using opposite GE Aerospace and FTC Solar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GE Aerospace position performs unexpectedly, FTC Solar 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 FTC Solar will offset losses from the drop in FTC Solar's long position.| GE Aerospace vs. Raytheon Technologies Corp | GE Aerospace vs. Caterpillar | GE Aerospace vs. The Boeing | GE Aerospace vs. Lockheed Martin |
| FTC Solar vs. Complete Solaria, | FTC Solar vs. Tigo Energy | FTC Solar vs. Zeo Energy Corp | FTC Solar vs. Emeren Group |
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 the Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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