Correlation Between NYSE Composite and Heliogen
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Heliogen 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 Heliogen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Heliogen, you can compare the effects of market volatilities on NYSE Composite and Heliogen 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 Heliogen. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Heliogen.
Diversification Opportunities for NYSE Composite and Heliogen
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NYSE and Heliogen is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Heliogen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heliogen 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 Heliogen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heliogen has no effect on the direction of NYSE Composite i.e., NYSE Composite and Heliogen go up and down completely randomly.
Pair Corralation between NYSE Composite and Heliogen
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.1 times more return on investment than Heliogen. However, NYSE Composite is 10.25 times less risky than Heliogen. It trades about 0.08 of its potential returns per unit of risk. Heliogen is currently generating about -0.05 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 | Insignificant |
| Accuracy | 28.45% |
| Values | Daily Returns |
NYSE Composite vs. Heliogen
Performance |
| Timeline |
NYSE Composite and Heliogen Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Heliogen
Pair trading matchups for Heliogen
Pair Trading with NYSE Composite and Heliogen
The main advantage of trading using opposite NYSE Composite and Heliogen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Heliogen 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 Heliogen will offset losses from the drop in Heliogen's long position.| NYSE Composite vs. Nextplat Corp | NYSE Composite vs. Qualys Inc | NYSE Composite vs. Cadence Design Systems | NYSE Composite vs. Asure Software |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |