Correlation Between NYSE Composite and Corpay
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Corpay 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 Corpay into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Corpay Inc, you can compare the effects of market volatilities on NYSE Composite and Corpay 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 Corpay. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Corpay.
Diversification Opportunities for NYSE Composite and Corpay
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between NYSE and Corpay is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Corpay Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corpay Inc 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 Corpay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corpay Inc has no effect on the direction of NYSE Composite i.e., NYSE Composite and Corpay go up and down completely randomly.
Pair Corralation between NYSE Composite and Corpay
Assuming the 90 days trading horizon NYSE Composite is expected to generate 3.58 times less return on investment than Corpay. But when comparing it to its historical volatility, NYSE Composite is 2.85 times less risky than Corpay. It trades about 0.24 of its potential returns per unit of risk. Corpay Inc is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 33,892 in Corpay Inc on August 28, 2024 and sell it today you would earn a total of 4,262 from holding Corpay Inc or generate 12.58% 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. Corpay Inc
Performance |
| Timeline |
NYSE Composite and Corpay Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Corpay Inc
Pair trading matchups for Corpay
Pair Trading with NYSE Composite and Corpay
The main advantage of trading using opposite NYSE Composite and Corpay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Corpay 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 Corpay will offset losses from the drop in Corpay's long position.| NYSE Composite vs. Hooker Furniture | NYSE Composite vs. Hudson Pacific Properties | NYSE Composite vs. Canlan Ice Sports | NYSE Composite vs. Boston Properties |
| Corpay vs. First Ship Lease | Corpay vs. Nike Inc | Corpay vs. Lululemon Athletica | Corpay vs. Kontoor Brands |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Other Complementary Tools
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites |