Correlation Between NYSE Composite and Armada Acquisition
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Armada Acquisition 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 NYSE Composite and Armada Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Armada Acquisition Corp, you can compare the effects of market volatilities on NYSE Composite and Armada Acquisition 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 NYSE Composite with a short position of Armada Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Armada Acquisition.
Diversification Opportunities for NYSE Composite and Armada Acquisition
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between NYSE and Armada is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Armada Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Armada Acquisition Corp and NYSE Composite 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 NYSE Composite are associated (or correlated) with Armada Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Armada Acquisition Corp has no effect on the direction of NYSE Composite i.e., NYSE Composite and Armada Acquisition go up and down completely randomly.
Pair Corralation between NYSE Composite and Armada Acquisition
Assuming the 90 days trading horizon NYSE Composite is expected to generate 392.07 times less return on investment than Armada Acquisition. But when comparing it to its historical volatility, NYSE Composite is 305.22 times less risky than Armada Acquisition. It trades about 0.14 of its potential returns per unit of risk. Armada Acquisition Corp is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 11.00 in Armada Acquisition Corp on September 1, 2024 and sell it today you would lose (11.00) from holding Armada Acquisition Corp or give up 100.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 36.51% |
| Values | Daily Returns |
NYSE Composite vs. Armada Acquisition Corp
Performance |
| Timeline |
NYSE Composite and Armada Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Pair Trading with NYSE Composite and Armada Acquisition
The main advantage of trading using opposite NYSE Composite and Armada Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Armada Acquisition 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 Armada Acquisition will offset losses from the drop in Armada Acquisition's long position.| NYSE Composite vs. Acumen Pharmaceuticals | NYSE Composite vs. Mind Medicine | NYSE Composite vs. NL Industries | NYSE Composite vs. Ecovyst |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |