Correlation Between NYSE Composite and Cambiar International
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Cambiar International 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 Cambiar International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Cambiar International Equity, you can compare the effects of market volatilities on NYSE Composite and Cambiar International 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 Cambiar International. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Cambiar International.
Diversification Opportunities for NYSE Composite and Cambiar International
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NYSE and Cambiar is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Cambiar International Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cambiar International 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 Cambiar International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cambiar International has no effect on the direction of NYSE Composite i.e., NYSE Composite and Cambiar International go up and down completely randomly.
Pair Corralation between NYSE Composite and Cambiar International
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.88 times more return on investment than Cambiar International. However, NYSE Composite is 1.14 times less risky than Cambiar International. It trades about 0.24 of its potential returns per unit of risk. Cambiar International Equity is currently generating about -0.32 per unit of risk. If you would invest 1,945,627 in NYSE Composite on August 26, 2024 and sell it today you would earn a total of 66,718 from holding NYSE Composite or generate 3.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Cambiar International Equity
Performance |
| Timeline |
NYSE Composite and Cambiar International Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Cambiar International Equity
Pair trading matchups for Cambiar International
Pair Trading with NYSE Composite and Cambiar International
The main advantage of trading using opposite NYSE Composite and Cambiar International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Cambiar International 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 Cambiar International will offset losses from the drop in Cambiar International's long position.| NYSE Composite vs. Grocery Outlet Holding | NYSE Composite vs. Tencent Music Entertainment | NYSE Composite vs. SunLink Health Systems | NYSE Composite vs. Getty Realty |
| Cambiar International vs. Congress Mid Cap | Cambiar International vs. Brandes International Small | Cambiar International vs. Johcm International Select | Cambiar International vs. Causeway Emerging Markets |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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