Correlation Between NYSE Composite and Cullen High
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Cullen High 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 Cullen High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Cullen High Dividend, you can compare the effects of market volatilities on NYSE Composite and Cullen High 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 Cullen High. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Cullen High.
Diversification Opportunities for NYSE Composite and Cullen High
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between NYSE and Cullen is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Cullen High Dividend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cullen High Dividend 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 Cullen High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cullen High Dividend has no effect on the direction of NYSE Composite i.e., NYSE Composite and Cullen High go up and down completely randomly.
Pair Corralation between NYSE Composite and Cullen High
Assuming the 90 days trading horizon NYSE Composite is expected to under-perform the Cullen High. In addition to that, NYSE Composite is 1.25 times more volatile than Cullen High Dividend. It trades about -0.02 of its total potential returns per unit of risk. Cullen High Dividend is currently generating about 0.0 per unit of volatility. If you would invest 1,343 in Cullen High Dividend on November 28, 2024 and sell it today you would earn a total of 0.00 from holding Cullen High Dividend or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
NYSE Composite vs. Cullen High Dividend
Performance |
| Timeline |
NYSE Composite and Cullen High Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Cullen High Dividend
Pair trading matchups for Cullen High
Pair Trading with NYSE Composite and Cullen High
The main advantage of trading using opposite NYSE Composite and Cullen High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Cullen High 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 Cullen High will offset losses from the drop in Cullen High's long position.| NYSE Composite vs. Inter Parfums | NYSE Composite vs. Amkor Technology | NYSE Composite vs. Unilever PLC ADR | NYSE Composite vs. Estee Lauder Companies |
| Cullen High vs. The Gabelli Healthcare | Cullen High vs. Deutsche Health And | Cullen High vs. Allianzgi Health Sciences | Cullen High vs. Baillie Gifford Health |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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