Correlation Between NYSE Composite and Agfa-Gevaert
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Agfa-Gevaert 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 Agfa-Gevaert into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Agfa Gevaert NV, you can compare the effects of market volatilities on NYSE Composite and Agfa-Gevaert 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 Agfa-Gevaert. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Agfa-Gevaert.
Diversification Opportunities for NYSE Composite and Agfa-Gevaert
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between NYSE and Agfa-Gevaert is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Agfa Gevaert NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agfa Gevaert NV 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 Agfa-Gevaert. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agfa Gevaert NV has no effect on the direction of NYSE Composite i.e., NYSE Composite and Agfa-Gevaert go up and down completely randomly.
Pair Corralation between NYSE Composite and Agfa-Gevaert
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.18 times more return on investment than Agfa-Gevaert. However, NYSE Composite is 5.7 times less risky than Agfa-Gevaert. It trades about 0.13 of its potential returns per unit of risk. Agfa Gevaert NV is currently generating about -0.12 per unit of risk. If you would invest 1,627,444 in NYSE Composite on September 4, 2024 and sell it today you would earn a total of 391,137 from holding NYSE Composite or generate 24.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Agfa Gevaert NV
Performance |
| Timeline |
NYSE Composite and Agfa-Gevaert Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Agfa Gevaert NV
Pair trading matchups for Agfa-Gevaert
Pair Trading with NYSE Composite and Agfa-Gevaert
The main advantage of trading using opposite NYSE Composite and Agfa-Gevaert positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Agfa-Gevaert 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 Agfa-Gevaert will offset losses from the drop in Agfa-Gevaert's long position.| NYSE Composite vs. Kite Realty Group | NYSE Composite vs. Tradeweb Markets | NYSE Composite vs. Meiwu Technology Co | NYSE Composite vs. Uber Technologies |
| Agfa-Gevaert vs. Apple Inc | Agfa-Gevaert vs. Microsoft | Agfa-Gevaert vs. Amazon Inc | Agfa-Gevaert vs. Alphabet Inc Class C |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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