Correlation Between Source KBW and Source Markets
Specify exactly 2 symbols:
By analyzing existing cross correlation between Source KBW NASDAQ and Source Markets plc, you can compare the effects of market volatilities on Source KBW and Source Markets 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 Source KBW with a short position of Source Markets. Check out your portfolio center. Please also check ongoing floating volatility patterns of Source KBW and Source Markets.
Diversification Opportunities for Source KBW and Source Markets
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Source and Source is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Source KBW NASDAQ and Source Markets plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Source Markets plc and Source KBW 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 Source KBW NASDAQ are associated (or correlated) with Source Markets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Source Markets plc has no effect on the direction of Source KBW i.e., Source KBW and Source Markets go up and down completely randomly.
Pair Corralation between Source KBW and Source Markets
Assuming the 90 days trading horizon Source KBW NASDAQ is expected to generate 1.21 times more return on investment than Source Markets. However, Source KBW is 1.21 times more volatile than Source Markets plc. It trades about 0.19 of its potential returns per unit of risk. Source Markets plc is currently generating about 0.03 per unit of risk. If you would invest 3,385 in Source KBW NASDAQ on September 14, 2024 and sell it today you would earn a total of 2,473 from holding Source KBW NASDAQ or generate 73.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Source KBW NASDAQ vs. Source Markets plc
Performance |
| Timeline |
| Source KBW NASDAQ |
| Source Markets plc |
Source KBW and Source Markets Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Source KBW and Source Markets
The main advantage of trading using opposite Source KBW and Source Markets positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Source KBW position performs unexpectedly, Source Markets 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 Source Markets will offset losses from the drop in Source Markets' long position.| Source KBW vs. Source JPX Nikkei 400 | Source KBW vs. Source Markets plc | Source KBW vs. Source Markets plc | Source KBW vs. Source Markets plc |
| Source Markets vs. Source JPX Nikkei 400 | Source Markets vs. Source Markets plc | Source Markets vs. Source Markets plc | Source Markets vs. Source KBW NASDAQ |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |