Correlation Between NYSE Composite and Cabaletta Bio
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Cabaletta Bio 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 Cabaletta Bio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Cabaletta Bio, you can compare the effects of market volatilities on NYSE Composite and Cabaletta Bio 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 Cabaletta Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Cabaletta Bio.
Diversification Opportunities for NYSE Composite and Cabaletta Bio
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NYSE and Cabaletta is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Cabaletta Bio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cabaletta Bio 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 Cabaletta Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cabaletta Bio has no effect on the direction of NYSE Composite i.e., NYSE Composite and Cabaletta Bio go up and down completely randomly.
Pair Corralation between NYSE Composite and Cabaletta Bio
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.12 times more return on investment than Cabaletta Bio. However, NYSE Composite is 8.47 times less risky than Cabaletta Bio. It trades about 0.14 of its potential returns per unit of risk. Cabaletta Bio is currently generating about -0.09 per unit of risk. If you would invest 1,523,001 in NYSE Composite on August 25, 2024 and sell it today you would earn a total of 489,344 from holding NYSE Composite or generate 32.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.66% |
| Values | Daily Returns |
NYSE Composite vs. Cabaletta Bio
Performance |
| Timeline |
NYSE Composite and Cabaletta Bio Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Cabaletta Bio
Pair trading matchups for Cabaletta Bio
Pair Trading with NYSE Composite and Cabaletta Bio
The main advantage of trading using opposite NYSE Composite and Cabaletta Bio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Cabaletta Bio 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 Cabaletta Bio will offset losses from the drop in Cabaletta Bio's long position.| NYSE Composite vs. Awilco Drilling PLC | NYSE Composite vs. AKITA Drilling | NYSE Composite vs. SunOpta | NYSE Composite vs. Delek Drilling |
| Cabaletta Bio vs. Lyra Therapeutics | Cabaletta Bio vs. Hookipa Pharma | Cabaletta Bio vs. SAB Biotherapeutics | Cabaletta Bio vs. Cadrenal Therapeutics, Common |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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