Correlation Between NYSE Composite and SinglePoint
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and SinglePoint 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 SinglePoint into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and SinglePoint, you can compare the effects of market volatilities on NYSE Composite and SinglePoint 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 SinglePoint. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and SinglePoint.
Diversification Opportunities for NYSE Composite and SinglePoint
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between NYSE and SinglePoint is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and SinglePoint in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SinglePoint 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 SinglePoint. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SinglePoint has no effect on the direction of NYSE Composite i.e., NYSE Composite and SinglePoint go up and down completely randomly.
Pair Corralation between NYSE Composite and SinglePoint
Assuming the 90 days trading horizon NYSE Composite is expected to generate 33.86 times less return on investment than SinglePoint. But when comparing it to its historical volatility, NYSE Composite is 58.18 times less risky than SinglePoint. It trades about 0.42 of its potential returns per unit of risk. SinglePoint is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 1.40 in SinglePoint on September 1, 2024 and sell it today you would earn a total of 2.20 from holding SinglePoint or generate 157.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. SinglePoint
Performance |
| Timeline |
NYSE Composite and SinglePoint Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
SinglePoint
Pair trading matchups for SinglePoint
Pair Trading with NYSE Composite and SinglePoint
The main advantage of trading using opposite NYSE Composite and SinglePoint positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, SinglePoint 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 SinglePoint will offset losses from the drop in SinglePoint's long position.| NYSE Composite vs. Acumen Pharmaceuticals | NYSE Composite vs. Mind Medicine | NYSE Composite vs. NL Industries | NYSE Composite vs. Ecovyst |
| SinglePoint vs. China Changjiang Mining | SinglePoint vs. FTC Solar | SinglePoint vs. Solar Integrated Roofing | SinglePoint vs. Ascent Solar Technologies, |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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