Correlation Between NYSE Composite and Fresenius
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Fresenius 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 Fresenius into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Fresenius SE Co, you can compare the effects of market volatilities on NYSE Composite and Fresenius 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 Fresenius. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Fresenius.
Diversification Opportunities for NYSE Composite and Fresenius
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between NYSE and Fresenius is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Fresenius SE Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fresenius SE 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 Fresenius. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fresenius SE has no effect on the direction of NYSE Composite i.e., NYSE Composite and Fresenius go up and down completely randomly.
Pair Corralation between NYSE Composite and Fresenius
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.43 times more return on investment than Fresenius. However, NYSE Composite is 2.32 times less risky than Fresenius. It trades about 0.08 of its potential returns per unit of risk. Fresenius SE Co is currently generating about 0.03 per unit of risk. If you would invest 1,551,444 in NYSE Composite on August 31, 2024 and sell it today you would earn a total of 475,760 from holding NYSE Composite or generate 30.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
NYSE Composite vs. Fresenius SE Co
Performance |
| Timeline |
NYSE Composite and Fresenius Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Fresenius SE Co
Pair trading matchups for Fresenius
Pair Trading with NYSE Composite and Fresenius
The main advantage of trading using opposite NYSE Composite and Fresenius positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Fresenius 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 Fresenius will offset losses from the drop in Fresenius' long position.| NYSE Composite vs. Nextplat Corp | NYSE Composite vs. Qualys Inc | NYSE Composite vs. Cadence Design Systems | NYSE Composite vs. Asure Software |
| Fresenius vs. Jack Nathan Medical | Fresenius vs. Medical Facilities | Fresenius vs. Ramsay Health Care | Fresenius vs. Nova Leap 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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