Correlation Between NYSE Composite and LiqTech International
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and LiqTech International 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 LiqTech International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and LiqTech International, you can compare the effects of market volatilities on NYSE Composite and LiqTech International 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 LiqTech International. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and LiqTech International.
Diversification Opportunities for NYSE Composite and LiqTech International
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between NYSE and LiqTech is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and LiqTech International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LiqTech International 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 LiqTech International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LiqTech International has no effect on the direction of NYSE Composite i.e., NYSE Composite and LiqTech International go up and down completely randomly.
Pair Corralation between NYSE Composite and LiqTech International
Assuming the 90 days trading horizon NYSE Composite is expected to generate 2.23 times less return on investment than LiqTech International. But when comparing it to its historical volatility, NYSE Composite is 10.28 times less risky than LiqTech International. It trades about 0.29 of its potential returns per unit of risk. LiqTech International is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 177.00 in LiqTech International on August 31, 2024 and sell it today you would earn a total of 8.00 from holding LiqTech International or generate 4.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. LiqTech International
Performance |
| Timeline |
NYSE Composite and LiqTech International Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
LiqTech International
Pair trading matchups for LiqTech International
Pair Trading with NYSE Composite and LiqTech International
The main advantage of trading using opposite NYSE Composite and LiqTech International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, LiqTech International 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 LiqTech International will offset losses from the drop in LiqTech International's long position.| NYSE Composite vs. Nextplat Corp | NYSE Composite vs. Qualys Inc | NYSE Composite vs. Cadence Design Systems | NYSE Composite vs. Asure Software |
| LiqTech International vs. China Natural Resources | LiqTech International vs. Seychelle Environmtl | LiqTech International vs. Vow ASA | LiqTech International vs. Eestech |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |