Correlation Between NYSE Composite and Lassonde Industries
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Lassonde Industries 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 Lassonde Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Lassonde Industries, you can compare the effects of market volatilities on NYSE Composite and Lassonde Industries 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 Lassonde Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Lassonde Industries.
Diversification Opportunities for NYSE Composite and Lassonde Industries
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between NYSE and Lassonde is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Lassonde Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lassonde Industries 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 Lassonde Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lassonde Industries has no effect on the direction of NYSE Composite i.e., NYSE Composite and Lassonde Industries go up and down completely randomly.
Pair Corralation between NYSE Composite and Lassonde Industries
Assuming the 90 days trading horizon NYSE Composite is expected to generate 2.3 times less return on investment than Lassonde Industries. But when comparing it to its historical volatility, NYSE Composite is 6.82 times less risky than Lassonde Industries. It trades about 0.11 of its potential returns per unit of risk. Lassonde Industries is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 11,253 in Lassonde Industries on August 27, 2024 and sell it today you would earn a total of 1,314 from holding Lassonde Industries or generate 11.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 77.66% |
| Values | Daily Returns |
NYSE Composite vs. Lassonde Industries
Performance |
| Timeline |
NYSE Composite and Lassonde Industries Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Lassonde Industries
Pair trading matchups for Lassonde Industries
Pair Trading with NYSE Composite and Lassonde Industries
The main advantage of trading using opposite NYSE Composite and Lassonde Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Lassonde Industries 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 Lassonde Industries will offset losses from the drop in Lassonde Industries' long position.| NYSE Composite vs. Grocery Outlet Holding | NYSE Composite vs. Tencent Music Entertainment | NYSE Composite vs. SunLink Health Systems | NYSE Composite vs. Getty Realty |
| Lassonde Industries vs. PepsiCo | Lassonde Industries vs. Coca Cola Consolidated | Lassonde Industries vs. Monster Beverage Corp | Lassonde Industries vs. Celsius Holdings |
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 CEOs Directory module to screen CEOs from public companies around the world.
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