Correlation Between NYSE Composite and Aptus Collared
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Aptus Collared 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 Aptus Collared into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Aptus Collared Income, you can compare the effects of market volatilities on NYSE Composite and Aptus Collared 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 Aptus Collared. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Aptus Collared.
Diversification Opportunities for NYSE Composite and Aptus Collared
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between NYSE and Aptus is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Aptus Collared Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aptus Collared Income 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 Aptus Collared. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aptus Collared Income has no effect on the direction of NYSE Composite i.e., NYSE Composite and Aptus Collared go up and down completely randomly.
Pair Corralation between NYSE Composite and Aptus Collared
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.94 times more return on investment than Aptus Collared. However, NYSE Composite is 1.07 times less risky than Aptus Collared. It trades about 0.26 of its potential returns per unit of risk. Aptus Collared Income is currently generating about 0.11 per unit of risk. If you would invest 1,945,669 in NYSE Composite on August 30, 2024 and sell it today you would earn a total of 75,313 from holding NYSE Composite or generate 3.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Aptus Collared Income
Performance |
| Timeline |
NYSE Composite and Aptus Collared Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Aptus Collared Income
Pair trading matchups for Aptus Collared
Pair Trading with NYSE Composite and Aptus Collared
The main advantage of trading using opposite NYSE Composite and Aptus Collared positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Aptus Collared 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 Aptus Collared will offset losses from the drop in Aptus Collared's long position.| NYSE Composite vs. Delek Drilling | NYSE Composite vs. Helmerich and Payne | NYSE Composite vs. Waste Management | NYSE Composite vs. US Global Investors |
| Aptus Collared vs. Aptus Drawdown Managed | Aptus Collared vs. Aptus Defined Risk | Aptus Collared vs. Opus Small Cap | Aptus Collared vs. Anfield Universal Fixed |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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