Correlation Between NYSE Composite and Hesai Group
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Hesai Group 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 Hesai Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Hesai Group American, you can compare the effects of market volatilities on NYSE Composite and Hesai Group 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 Hesai Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Hesai Group.
Diversification Opportunities for NYSE Composite and Hesai Group
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between NYSE and Hesai is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Hesai Group American in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hesai Group American 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 Hesai Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hesai Group American has no effect on the direction of NYSE Composite i.e., NYSE Composite and Hesai Group go up and down completely randomly.
Pair Corralation between NYSE Composite and Hesai Group
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.17 times more return on investment than Hesai Group. However, NYSE Composite is 5.77 times less risky than Hesai Group. It trades about 0.21 of its potential returns per unit of risk. Hesai Group American is currently generating about 0.01 per unit of risk. If you would invest 1,954,967 in NYSE Composite on August 27, 2024 and sell it today you would earn a total of 57,378 from holding NYSE Composite or generate 2.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Hesai Group American
Performance |
| Timeline |
NYSE Composite and Hesai Group Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Hesai Group American
Pair trading matchups for Hesai Group
Pair Trading with NYSE Composite and Hesai Group
The main advantage of trading using opposite NYSE Composite and Hesai Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Hesai Group 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 Hesai Group will offset losses from the drop in Hesai Group's long position.| NYSE Composite vs. Grocery Outlet Holding | NYSE Composite vs. Tencent Music Entertainment | NYSE Composite vs. SunLink Health Systems | NYSE Composite vs. Getty Realty |
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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