Correlation Between NYSE Composite and MYMF
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and MYMF 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 MYMF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and MYMF, you can compare the effects of market volatilities on NYSE Composite and MYMF 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 MYMF. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and MYMF.
Diversification Opportunities for NYSE Composite and MYMF
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NYSE and MYMF is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and MYMF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MYMF 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 MYMF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MYMF has no effect on the direction of NYSE Composite i.e., NYSE Composite and MYMF go up and down completely randomly.
Pair Corralation between NYSE Composite and MYMF
Assuming the 90 days trading horizon NYSE Composite is expected to generate 4.76 times more return on investment than MYMF. However, NYSE Composite is 4.76 times more volatile than MYMF. It trades about 0.43 of its potential returns per unit of risk. MYMF is currently generating about 0.26 per unit of risk. If you would invest 1,924,339 in NYSE Composite on September 3, 2024 and sell it today you would earn a total of 102,865 from holding NYSE Composite or generate 5.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. MYMF
Performance |
| Timeline |
NYSE Composite and MYMF Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Pair Trading with NYSE Composite and MYMF
The main advantage of trading using opposite NYSE Composite and MYMF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, MYMF 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 MYMF will offset losses from the drop in MYMF's long position.| NYSE Composite vs. Lindblad Expeditions Holdings | NYSE Composite vs. LB Foster | NYSE Composite vs. HUTCHMED DRC | NYSE Composite vs. Bridgford Foods |
| MYMF vs. VanEck Vectors Moodys | MYMF vs. Xtrackers California Municipal | MYMF vs. Vanguard ESG Corporate | MYMF vs. Vanguard Intermediate Term Corporate |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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