Correlation Between NYSE Composite and Columbia Commodity
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Columbia Commodity 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 Columbia Commodity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Columbia Modity Strategy, you can compare the effects of market volatilities on NYSE Composite and Columbia Commodity 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 Columbia Commodity. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Columbia Commodity.
Diversification Opportunities for NYSE Composite and Columbia Commodity
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NYSE and Columbia is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Columbia Modity Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Columbia Modity Strategy 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 Columbia Commodity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Columbia Modity Strategy has no effect on the direction of NYSE Composite i.e., NYSE Composite and Columbia Commodity go up and down completely randomly.
Pair Corralation between NYSE Composite and Columbia Commodity
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.78 times more return on investment than Columbia Commodity. However, NYSE Composite is 1.29 times less risky than Columbia Commodity. It trades about 0.19 of its potential returns per unit of risk. Columbia Modity Strategy is currently generating about -0.02 per unit of risk. If you would invest 1,956,073 in NYSE Composite on August 25, 2024 and sell it today you would earn a total of 56,272 from holding NYSE Composite or generate 2.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Columbia Modity Strategy
Performance |
| Timeline |
NYSE Composite and Columbia Commodity Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Columbia Modity Strategy
Pair trading matchups for Columbia Commodity
Pair Trading with NYSE Composite and Columbia Commodity
The main advantage of trading using opposite NYSE Composite and Columbia Commodity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Columbia Commodity 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 Columbia Commodity will offset losses from the drop in Columbia Commodity's long position.| NYSE Composite vs. Awilco Drilling PLC | NYSE Composite vs. AKITA Drilling | NYSE Composite vs. SunOpta | NYSE Composite vs. Delek Drilling |
| Columbia Commodity vs. Rbc Emerging Markets | Columbia Commodity vs. Ab All Market | Columbia Commodity vs. T Rowe Price | Columbia Commodity vs. Doubleline 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences |