Correlation Between NYSE Composite and AKA Brands
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and AKA Brands 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 AKA Brands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and AKA Brands Holding, you can compare the effects of market volatilities on NYSE Composite and AKA Brands 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 AKA Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and AKA Brands.
Diversification Opportunities for NYSE Composite and AKA Brands
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NYSE and AKA is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and AKA Brands Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AKA Brands Holding 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 AKA Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AKA Brands Holding has no effect on the direction of NYSE Composite i.e., NYSE Composite and AKA Brands go up and down completely randomly.
Pair Corralation between NYSE Composite and AKA Brands
Assuming the 90 days trading horizon NYSE Composite is expected to generate 2.41 times less return on investment than AKA Brands. But when comparing it to its historical volatility, NYSE Composite is 11.32 times less risky than AKA Brands. It trades about 0.12 of its potential returns per unit of risk. AKA Brands Holding is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 2,222 in AKA Brands Holding on August 30, 2024 and sell it today you would lose (86.00) from holding AKA Brands Holding or give up 3.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. AKA Brands Holding
Performance |
| Timeline |
NYSE Composite and AKA Brands Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
AKA Brands Holding
Pair trading matchups for AKA Brands
Pair Trading with NYSE Composite and AKA Brands
The main advantage of trading using opposite NYSE Composite and AKA Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, AKA Brands 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 AKA Brands will offset losses from the drop in AKA Brands' long position.| NYSE Composite vs. Nextplat Corp | NYSE Composite vs. Qualys Inc | NYSE Composite vs. Cadence Design Systems | NYSE Composite vs. Asure Software |
| AKA Brands vs. Brilliant Earth Group | AKA Brands vs. Lulus Fashion Lounge | AKA Brands vs. Torrid Holdings | AKA Brands vs. Aveanna Healthcare Holdings |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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