Correlation Between NYSE Composite and International Media
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and International Media 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 International Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and International Media Acquisition, you can compare the effects of market volatilities on NYSE Composite and International Media 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 International Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and International Media.
Diversification Opportunities for NYSE Composite and International Media
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NYSE and International is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and International Media Acquisitio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Media 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 International Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Media has no effect on the direction of NYSE Composite i.e., NYSE Composite and International Media go up and down completely randomly.
Pair Corralation between NYSE Composite and International Media
Assuming the 90 days trading horizon NYSE Composite is expected to generate 1.18 times less return on investment than International Media. But when comparing it to its historical volatility, NYSE Composite is 2.58 times less risky than International Media. It trades about 0.14 of its potential returns per unit of risk. International Media Acquisition is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,018 in International Media Acquisition on September 2, 2024 and sell it today you would earn a total of 182.00 from holding International Media Acquisition or generate 17.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 68.95% |
| Values | Daily Returns |
NYSE Composite vs. International Media Acquisitio
Performance |
| Timeline |
NYSE Composite and International Media Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
International Media Acquisition
Pair trading matchups for International Media
Pair Trading with NYSE Composite and International Media
The main advantage of trading using opposite NYSE Composite and International Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, International Media 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 International Media will offset losses from the drop in International Media's long position.| NYSE Composite vs. Simon Property Group | NYSE Composite vs. Merit Medical Systems | NYSE Composite vs. Catalent | NYSE Composite vs. Titan Machinery |
| International Media vs. Arrow Electronics | International Media vs. Ecovyst | International Media vs. Avient Corp | International Media vs. National Beverage Corp |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |