Correlation Between NYSE Composite and NeoMagic
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and NeoMagic 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 NeoMagic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and NeoMagic, you can compare the effects of market volatilities on NYSE Composite and NeoMagic 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 NeoMagic. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and NeoMagic.
Diversification Opportunities for NYSE Composite and NeoMagic
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between NYSE and NeoMagic is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and NeoMagic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NeoMagic 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 NeoMagic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NeoMagic has no effect on the direction of NYSE Composite i.e., NYSE Composite and NeoMagic go up and down completely randomly.
Pair Corralation between NYSE Composite and NeoMagic
If you would invest (100.00) in NeoMagic on November 29, 2024 and sell it today you would earn a total of 100.00 from holding NeoMagic or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
NYSE Composite vs. NeoMagic
Performance |
| Timeline |
NYSE Composite and NeoMagic Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
NeoMagic
Pair trading matchups for NeoMagic
Pair Trading with NYSE Composite and NeoMagic
The main advantage of trading using opposite NYSE Composite and NeoMagic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, NeoMagic 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 NeoMagic will offset losses from the drop in NeoMagic's long position.| NYSE Composite vs. Kenon Holdings | NYSE Composite vs. American Electric Power | NYSE Composite vs. Mesa Air Group | NYSE Composite vs. Suburban Propane Partners |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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