Correlation Between NYSE Composite and MannKind Corp
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and MannKind Corp 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 MannKind Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and MannKind Corp, you can compare the effects of market volatilities on NYSE Composite and MannKind Corp 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 MannKind Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and MannKind Corp.
Diversification Opportunities for NYSE Composite and MannKind Corp
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NYSE and MannKind is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and MannKind Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MannKind Corp 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 MannKind Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MannKind Corp has no effect on the direction of NYSE Composite i.e., NYSE Composite and MannKind Corp go up and down completely randomly.
Pair Corralation between NYSE Composite and MannKind Corp
Assuming the 90 days trading horizon NYSE Composite is expected to generate 1.95 times less return on investment than MannKind Corp. But when comparing it to its historical volatility, NYSE Composite is 4.38 times less risky than MannKind Corp. It trades about 0.08 of its potential returns per unit of risk. MannKind Corp is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 496.00 in MannKind Corp on August 28, 2024 and sell it today you would earn a total of 176.00 from holding MannKind Corp or generate 35.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. MannKind Corp
Performance |
| Timeline |
NYSE Composite and MannKind Corp Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
MannKind Corp
Pair trading matchups for MannKind Corp
Pair Trading with NYSE Composite and MannKind Corp
The main advantage of trading using opposite NYSE Composite and MannKind Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, MannKind Corp 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 MannKind Corp will offset losses from the drop in MannKind Corp's long position.| NYSE Composite vs. Vita Coco | NYSE Composite vs. Franklin Wireless Corp | NYSE Composite vs. Ambev SA ADR | NYSE Composite vs. Toro Co |
| MannKind Corp vs. Biomarin Pharmaceutical | MannKind Corp vs. Vaxcyte | MannKind Corp vs. Liquidia Technologies | MannKind Corp vs. Legend Biotech Corp |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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