Correlation Between NYSE Composite and Clipper Fund
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Clipper Fund 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 Clipper Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Clipper Fund Inc, you can compare the effects of market volatilities on NYSE Composite and Clipper Fund 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 Clipper Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Clipper Fund.
Diversification Opportunities for NYSE Composite and Clipper Fund
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between NYSE and Clipper is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Clipper Fund Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clipper Fund 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 Clipper Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clipper Fund has no effect on the direction of NYSE Composite i.e., NYSE Composite and Clipper Fund go up and down completely randomly.
Pair Corralation between NYSE Composite and Clipper Fund
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.84 times more return on investment than Clipper Fund. However, NYSE Composite is 1.19 times less risky than Clipper Fund. It trades about 0.04 of its potential returns per unit of risk. Clipper Fund Inc is currently generating about 0.03 per unit of risk. If you would invest 1,896,301 in NYSE Composite on December 11, 2024 and sell it today you would earn a total of 23,937 from holding NYSE Composite or generate 1.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Clipper Fund Inc
Performance |
| Timeline |
NYSE Composite and Clipper Fund Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Clipper Fund Inc
Pair trading matchups for Clipper Fund
Pair Trading with NYSE Composite and Clipper Fund
The main advantage of trading using opposite NYSE Composite and Clipper Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Clipper Fund 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 Clipper Fund will offset losses from the drop in Clipper Fund's long position.| NYSE Composite vs. SNDL Inc | NYSE Composite vs. Monster Beverage Corp | NYSE Composite vs. Brandywine Realty Trust | NYSE Composite vs. Nascent Wine |
| Clipper Fund vs. Value Fund Value | Clipper Fund vs. Meridian Trarian Fund | Clipper Fund vs. Longleaf Partners Fund | Clipper Fund vs. Mairs Power Growth |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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