Correlation Between NYSE Composite and Casa Systems
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Casa Systems 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 Casa Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Casa Systems, you can compare the effects of market volatilities on NYSE Composite and Casa Systems 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 Casa Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Casa Systems.
Diversification Opportunities for NYSE Composite and Casa Systems
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NYSE and Casa is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Casa Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Casa Systems 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 Casa Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Casa Systems has no effect on the direction of NYSE Composite i.e., NYSE Composite and Casa Systems go up and down completely randomly.
Pair Corralation between NYSE Composite and Casa Systems
Assuming the 90 days trading horizon NYSE Composite is expected to generate 4.01 times less return on investment than Casa Systems. But when comparing it to its historical volatility, NYSE Composite is 9.21 times less risky than Casa Systems. It trades about 0.11 of its potential returns per unit of risk. Casa Systems is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 107.00 in Casa Systems on August 31, 2024 and sell it today you would earn a total of 4.00 from holding Casa Systems or generate 3.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 8.56% |
| Values | Daily Returns |
NYSE Composite vs. Casa Systems
Performance |
| Timeline |
NYSE Composite and Casa Systems Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Casa Systems
Pair trading matchups for Casa Systems
Pair Trading with NYSE Composite and Casa Systems
The main advantage of trading using opposite NYSE Composite and Casa Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Casa Systems 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 Casa Systems will offset losses from the drop in Casa Systems' long position.| NYSE Composite vs. Nextplat Corp | NYSE Composite vs. Qualys Inc | NYSE Composite vs. Cadence Design Systems | NYSE Composite vs. Asure Software |
| Casa Systems vs. ADTRAN Inc | Casa Systems vs. Comtech Telecommunications Corp | Casa Systems vs. Digi International | Casa Systems vs. KVH Industries |
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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