Correlation Between NYSE Composite and LIXIL
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and LIXIL 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 LIXIL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and LIXIL, you can compare the effects of market volatilities on NYSE Composite and LIXIL 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 LIXIL. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and LIXIL.
Diversification Opportunities for NYSE Composite and LIXIL
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between NYSE and LIXIL is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and LIXIL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LIXIL 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 LIXIL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LIXIL has no effect on the direction of NYSE Composite i.e., NYSE Composite and LIXIL go up and down completely randomly.
Pair Corralation between NYSE Composite and LIXIL
If you would invest 1,925,354 in NYSE Composite on September 2, 2024 and sell it today you would earn a total of 101,850 from holding NYSE Composite or generate 5.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
NYSE Composite vs. LIXIL
Performance |
| Timeline |
NYSE Composite and LIXIL Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
LIXIL
Pair trading matchups for LIXIL
Pair Trading with NYSE Composite and LIXIL
The main advantage of trading using opposite NYSE Composite and LIXIL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, LIXIL 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 LIXIL will offset losses from the drop in LIXIL's long position.| NYSE Composite vs. Simon Property Group | NYSE Composite vs. Merit Medical Systems | NYSE Composite vs. Catalent | NYSE Composite vs. Titan Machinery |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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