Correlation Between NYSE Composite and Allegiant Gold
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Allegiant Gold 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 Allegiant Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Allegiant Gold, you can compare the effects of market volatilities on NYSE Composite and Allegiant Gold 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 Allegiant Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Allegiant Gold.
Diversification Opportunities for NYSE Composite and Allegiant Gold
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between NYSE and Allegiant is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Allegiant Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allegiant Gold 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 Allegiant Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allegiant Gold has no effect on the direction of NYSE Composite i.e., NYSE Composite and Allegiant Gold go up and down completely randomly.
Pair Corralation between NYSE Composite and Allegiant Gold
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.14 times more return on investment than Allegiant Gold. However, NYSE Composite is 6.99 times less risky than Allegiant Gold. It trades about 0.27 of its potential returns per unit of risk. Allegiant Gold is currently generating about -0.14 per unit of risk. If you would invest 1,895,821 in NYSE Composite on October 20, 2024 and sell it today you would earn a total of 64,916 from holding NYSE Composite or generate 3.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
NYSE Composite vs. Allegiant Gold
Performance |
| Timeline |
NYSE Composite and Allegiant Gold Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Allegiant Gold
Pair trading matchups for Allegiant Gold
Pair Trading with NYSE Composite and Allegiant Gold
The main advantage of trading using opposite NYSE Composite and Allegiant Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Allegiant Gold 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 Allegiant Gold will offset losses from the drop in Allegiant Gold's long position.| NYSE Composite vs. National Health Investors | NYSE Composite vs. Arbor Realty Trust | NYSE Composite vs. Canaf Investments | NYSE Composite vs. Freedom Holding Corp |
| Allegiant Gold vs. Minnova Corp | Allegiant Gold vs. Argo Gold | Allegiant Gold vs. Advance Gold Corp | Allegiant Gold vs. Blue Star Gold |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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