Correlation Between NYSE Composite and Investec
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Investec 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 Investec into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Investec Group, you can compare the effects of market volatilities on NYSE Composite and Investec 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 Investec. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Investec.
Diversification Opportunities for NYSE Composite and Investec
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NYSE and Investec is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Investec Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investec Group 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 Investec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investec Group has no effect on the direction of NYSE Composite i.e., NYSE Composite and Investec go up and down completely randomly.
Pair Corralation between NYSE Composite and Investec
Assuming the 90 days trading horizon NYSE Composite is expected to under-perform the Investec. But the index apears to be less risky and, when comparing its historical volatility, NYSE Composite is 1.19 times less risky than Investec. The index trades about -0.29 of its potential returns per unit of risk. The Investec Group is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 1,062 in Investec Group on September 22, 2024 and sell it today you would earn a total of 42.00 from holding Investec Group or generate 3.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
NYSE Composite vs. Investec Group
Performance |
| Timeline |
NYSE Composite and Investec Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Investec Group
Pair trading matchups for Investec
Pair Trading with NYSE Composite and Investec
The main advantage of trading using opposite NYSE Composite and Investec positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Investec 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 Investec will offset losses from the drop in Investec's long position.| NYSE Composite vs. Sweetgreen | NYSE Composite vs. Siriuspoint | NYSE Composite vs. Park Hotels Resorts | NYSE Composite vs. Kura Sushi USA |
| Investec vs. Turning Point Brands | Investec vs. BCE Inc | Investec vs. Weibo Corp | Investec vs. Molson Coors Brewing |
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
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| 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 | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |