Correlation Between NYSE Composite and Globalfoundries
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Globalfoundries 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 Globalfoundries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Globalfoundries, you can compare the effects of market volatilities on NYSE Composite and Globalfoundries 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 Globalfoundries. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Globalfoundries.
Diversification Opportunities for NYSE Composite and Globalfoundries
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between NYSE and Globalfoundries is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Globalfoundries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Globalfoundries 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 Globalfoundries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Globalfoundries has no effect on the direction of NYSE Composite i.e., NYSE Composite and Globalfoundries go up and down completely randomly.
Pair Corralation between NYSE Composite and Globalfoundries
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.25 times more return on investment than Globalfoundries. However, NYSE Composite is 3.99 times less risky than Globalfoundries. It trades about 0.11 of its potential returns per unit of risk. Globalfoundries is currently generating about -0.04 per unit of risk. If you would invest 1,663,938 in NYSE Composite on November 9, 2024 and sell it today you would earn a total of 351,820 from holding NYSE Composite or generate 21.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Globalfoundries
Performance |
| Timeline |
NYSE Composite and Globalfoundries Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Globalfoundries
Pair trading matchups for Globalfoundries
Pair Trading with NYSE Composite and Globalfoundries
The main advantage of trading using opposite NYSE Composite and Globalfoundries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Globalfoundries 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 Globalfoundries will offset losses from the drop in Globalfoundries' long position.| NYSE Composite vs. Integrated Media Technology | NYSE Composite vs. Custom Truck One | NYSE Composite vs. Funko Inc | NYSE Composite vs. Multi Ways Holdings |
| Globalfoundries vs. NXP Semiconductors NV | Globalfoundries vs. Analog Devices | Globalfoundries vs. ON Semiconductor | Globalfoundries vs. Lattice Semiconductor |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |