Correlation Between NYSE Composite and Oxford BioDynamics
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Oxford BioDynamics 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 Oxford BioDynamics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Oxford BioDynamics Plc, you can compare the effects of market volatilities on NYSE Composite and Oxford BioDynamics 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 Oxford BioDynamics. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Oxford BioDynamics.
Diversification Opportunities for NYSE Composite and Oxford BioDynamics
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between NYSE and Oxford is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Oxford BioDynamics Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oxford BioDynamics Plc 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 Oxford BioDynamics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oxford BioDynamics Plc has no effect on the direction of NYSE Composite i.e., NYSE Composite and Oxford BioDynamics go up and down completely randomly.
Pair Corralation between NYSE Composite and Oxford BioDynamics
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.04 times more return on investment than Oxford BioDynamics. However, NYSE Composite is 25.43 times less risky than Oxford BioDynamics. It trades about -0.04 of its potential returns per unit of risk. Oxford BioDynamics Plc is currently generating about -0.22 per unit of risk. If you would invest 1,984,542 in NYSE Composite on September 14, 2024 and sell it today you would lose (7,633) from holding NYSE Composite or give up 0.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Oxford BioDynamics Plc
Performance |
| Timeline |
NYSE Composite and Oxford BioDynamics Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Oxford BioDynamics Plc
Pair trading matchups for Oxford BioDynamics
Pair Trading with NYSE Composite and Oxford BioDynamics
The main advantage of trading using opposite NYSE Composite and Oxford BioDynamics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Oxford BioDynamics 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 Oxford BioDynamics will offset losses from the drop in Oxford BioDynamics' long position.| NYSE Composite vs. Air Products and | NYSE Composite vs. Allient | NYSE Composite vs. Ecovyst | NYSE Composite vs. CTS Corporation |
| Oxford BioDynamics vs. Protalix Biotherapeutics | Oxford BioDynamics vs. Seres Therapeutics | Oxford BioDynamics vs. Cidara Therapeutics | Oxford BioDynamics vs. Immunitybio |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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