Correlation Between NYSE Composite and Janus High-yield
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Janus High-yield 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 Janus High-yield into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Janus High Yield Fund, you can compare the effects of market volatilities on NYSE Composite and Janus High-yield 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 Janus High-yield. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Janus High-yield.
Diversification Opportunities for NYSE Composite and Janus High-yield
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between NYSE and Janus is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Janus High Yield Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Janus High Yield 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 Janus High-yield. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Janus High Yield has no effect on the direction of NYSE Composite i.e., NYSE Composite and Janus High-yield go up and down completely randomly.
Pair Corralation between NYSE Composite and Janus High-yield
Assuming the 90 days trading horizon NYSE Composite is expected to generate 2.52 times more return on investment than Janus High-yield. However, NYSE Composite is 2.52 times more volatile than Janus High Yield Fund. It trades about 0.16 of its potential returns per unit of risk. Janus High Yield Fund is currently generating about 0.2 per unit of risk. If you would invest 1,544,050 in NYSE Composite on September 1, 2024 and sell it today you would earn a total of 483,154 from holding NYSE Composite or generate 31.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Janus High Yield Fund
Performance |
| Timeline |
NYSE Composite and Janus High-yield Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Janus High Yield Fund
Pair trading matchups for Janus High-yield
Pair Trading with NYSE Composite and Janus High-yield
The main advantage of trading using opposite NYSE Composite and Janus High-yield positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Janus High-yield 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 Janus High-yield will offset losses from the drop in Janus High-yield's long position.| NYSE Composite vs. Acumen Pharmaceuticals | NYSE Composite vs. Mind Medicine | NYSE Composite vs. NL Industries | NYSE Composite vs. Ecovyst |
| Janus High-yield vs. Janus Flexible Bond | Janus High-yield vs. Janus Short Term Bond | Janus High-yield vs. Metropolitan West High | Janus High-yield vs. T Rowe Price |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity |