Correlation Between NYSE Composite and Protagenic Therapeutics
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Protagenic Therapeutics 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 Protagenic Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Protagenic Therapeutics, you can compare the effects of market volatilities on NYSE Composite and Protagenic Therapeutics 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 Protagenic Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Protagenic Therapeutics.
Diversification Opportunities for NYSE Composite and Protagenic Therapeutics
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NYSE and Protagenic is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Protagenic Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Protagenic Therapeutics 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 Protagenic Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Protagenic Therapeutics has no effect on the direction of NYSE Composite i.e., NYSE Composite and Protagenic Therapeutics go up and down completely randomly.
Pair Corralation between NYSE Composite and Protagenic Therapeutics
Assuming the 90 days trading horizon NYSE Composite is expected to generate 8.57 times less return on investment than Protagenic Therapeutics. But when comparing it to its historical volatility, NYSE Composite is 14.62 times less risky than Protagenic Therapeutics. It trades about 0.14 of its potential returns per unit of risk. Protagenic Therapeutics is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 58.00 in Protagenic Therapeutics on August 29, 2024 and sell it today you would earn a total of 15.00 from holding Protagenic Therapeutics or generate 25.86% 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. Protagenic Therapeutics
Performance |
| Timeline |
NYSE Composite and Protagenic Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Protagenic Therapeutics
Pair trading matchups for Protagenic Therapeutics
Pair Trading with NYSE Composite and Protagenic Therapeutics
The main advantage of trading using opposite NYSE Composite and Protagenic Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Protagenic Therapeutics 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 Protagenic Therapeutics will offset losses from the drop in Protagenic Therapeutics' long position.| NYSE Composite vs. Vita Coco | NYSE Composite vs. Franklin Wireless Corp | NYSE Composite vs. Ambev SA ADR | NYSE Composite vs. Toro Co |
| Protagenic Therapeutics vs. Sino Biopharmaceutical Ltd | Protagenic Therapeutics vs. Eledon Pharmaceuticals | Protagenic Therapeutics vs. Rezolute | Protagenic Therapeutics vs. XOMA Corporation |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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