Correlation Between NYSE Composite and Golub Capital
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Golub Capital 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 Golub Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Golub Capital BDC, you can compare the effects of market volatilities on NYSE Composite and Golub Capital 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 Golub Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Golub Capital.
Diversification Opportunities for NYSE Composite and Golub Capital
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between NYSE and Golub is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Golub Capital BDC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golub Capital BDC 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 Golub Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golub Capital BDC has no effect on the direction of NYSE Composite i.e., NYSE Composite and Golub Capital go up and down completely randomly.
Pair Corralation between NYSE Composite and Golub Capital
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.65 times more return on investment than Golub Capital. However, NYSE Composite is 1.53 times less risky than Golub Capital. It trades about 0.13 of its potential returns per unit of risk. Golub Capital BDC is currently generating about -0.07 per unit of risk. If you would invest 1,959,424 in NYSE Composite on August 24, 2024 and sell it today you would earn a total of 37,406 from holding NYSE Composite or generate 1.91% 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. Golub Capital BDC
Performance |
| Timeline |
NYSE Composite and Golub Capital Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Golub Capital BDC
Pair trading matchups for Golub Capital
Pair Trading with NYSE Composite and Golub Capital
The main advantage of trading using opposite NYSE Composite and Golub Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Golub Capital 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 Golub Capital will offset losses from the drop in Golub Capital's long position.| NYSE Composite vs. Awilco Drilling PLC | NYSE Composite vs. AKITA Drilling | NYSE Composite vs. SunOpta | NYSE Composite vs. Delek Drilling |
| Golub Capital vs. BlackRock TCP Capital | Golub Capital vs. Carlyle Secured Lending | Golub Capital vs. Triplepoint Venture Growth | Golub Capital vs. New Mountain Finance |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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