Correlation Between NYSE Composite and SITC International
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and SITC International 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 SITC International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and SITC International Holdings, you can compare the effects of market volatilities on NYSE Composite and SITC International 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 SITC International. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and SITC International.
Diversification Opportunities for NYSE Composite and SITC International
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between NYSE and SITC is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and SITC International Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SITC International 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 SITC International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SITC International has no effect on the direction of NYSE Composite i.e., NYSE Composite and SITC International go up and down completely randomly.
Pair Corralation between NYSE Composite and SITC International
Assuming the 90 days trading horizon NYSE Composite is expected to generate 7.05 times less return on investment than SITC International. But when comparing it to its historical volatility, NYSE Composite is 6.92 times less risky than SITC International. It trades about 0.08 of its potential returns per unit of risk. SITC International Holdings is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 54.00 in SITC International Holdings on August 31, 2024 and sell it today you would earn a total of 184.00 from holding SITC International Holdings or generate 340.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
NYSE Composite vs. SITC International Holdings
Performance |
| Timeline |
NYSE Composite and SITC International Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
SITC International Holdings
Pair trading matchups for SITC International
Pair Trading with NYSE Composite and SITC International
The main advantage of trading using opposite NYSE Composite and SITC International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, SITC International 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 SITC International will offset losses from the drop in SITC International's long position.| NYSE Composite vs. Nextplat Corp | NYSE Composite vs. Qualys Inc | NYSE Composite vs. Cadence Design Systems | NYSE Composite vs. Asure Software |
| SITC International vs. Hapag Lloyd Aktiengesellschaft | SITC International vs. Hapag Lloyd Aktiengesellschaft | SITC International vs. AP Moeller Maersk AS | SITC International vs. AP Mller |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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