Correlation Between California Municipal and New York
Can any of the company-specific risk be diversified away by investing in both California Municipal and New York 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 California Municipal and New York into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between California Municipal Portfolio and New York Municipal, you can compare the effects of market volatilities on California Municipal and New York 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 California Municipal with a short position of New York. Check out your portfolio center. Please also check ongoing floating volatility patterns of California Municipal and New York.
Diversification Opportunities for California Municipal and New York
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between California and New is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding California Municipal Portfolio and New York Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New York Municipal and California Municipal 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 California Municipal Portfolio are associated (or correlated) with New York. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New York Municipal has no effect on the direction of California Municipal i.e., California Municipal and New York go up and down completely randomly.
Pair Corralation between California Municipal and New York
If you would invest 1,263 in New York Municipal on August 24, 2024 and sell it today you would earn a total of 86.00 from holding New York Municipal or generate 6.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
California Municipal Portfolio vs. New York Municipal
Performance |
| Timeline |
| California Municipal |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| New York Municipal |
California Municipal and New York Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with California Municipal and New York
The main advantage of trading using opposite California Municipal and New York positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if California Municipal position performs unexpectedly, New York 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 New York will offset losses from the drop in New York's long position.| California Municipal vs. California High Yield Municipal | California Municipal vs. Artisan High Income | California Municipal vs. Calvert High Yield | California Municipal vs. Metropolitan West High |
| New York vs. Ab New York | New York vs. Opnhmr Rchstr Ltd | New York vs. California Municipal Portfolio | New York vs. Ab New Jersey |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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