Correlation Between NYSE Composite and NextCure
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and NextCure 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 NextCure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and NextCure, you can compare the effects of market volatilities on NYSE Composite and NextCure 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 NextCure. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and NextCure.
Diversification Opportunities for NYSE Composite and NextCure
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NYSE and NextCure is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and NextCure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NextCure 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 NextCure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NextCure has no effect on the direction of NYSE Composite i.e., NYSE Composite and NextCure go up and down completely randomly.
Pair Corralation between NYSE Composite and NextCure
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.17 times more return on investment than NextCure. However, NYSE Composite is 5.82 times less risky than NextCure. It trades about 0.08 of its potential returns per unit of risk. NextCure is currently generating about 0.01 per unit of risk. If you would invest 1,532,846 in NYSE Composite on August 27, 2024 and sell it today you would earn a total of 479,499 from holding NYSE Composite or generate 31.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. NextCure
Performance |
| Timeline |
NYSE Composite and NextCure Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
NextCure
Pair trading matchups for NextCure
Pair Trading with NYSE Composite and NextCure
The main advantage of trading using opposite NYSE Composite and NextCure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, NextCure 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 NextCure will offset losses from the drop in NextCure's 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 |
| NextCure vs. CytomX Therapeutics | NextCure vs. Spero Therapeutics | NextCure vs. Instil Bio | NextCure vs. Assembly Biosciences |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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