Correlation Between NYSE Composite and Silver Tiger
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Silver Tiger 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 Silver Tiger into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Silver Tiger Metals, you can compare the effects of market volatilities on NYSE Composite and Silver Tiger 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 Silver Tiger. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Silver Tiger.
Diversification Opportunities for NYSE Composite and Silver Tiger
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between NYSE and Silver is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Silver Tiger Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silver Tiger Metals 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 Silver Tiger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silver Tiger Metals has no effect on the direction of NYSE Composite i.e., NYSE Composite and Silver Tiger go up and down completely randomly.
Pair Corralation between NYSE Composite and Silver Tiger
Assuming the 90 days trading horizon NYSE Composite is expected to under-perform the Silver Tiger. But the index apears to be less risky and, when comparing its historical volatility, NYSE Composite is 9.65 times less risky than Silver Tiger. The index trades about -0.02 of its potential returns per unit of risk. The Silver Tiger Metals is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 20.00 in Silver Tiger Metals on November 28, 2024 and sell it today you would earn a total of 2.00 from holding Silver Tiger Metals or generate 10.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Silver Tiger Metals
Performance |
| Timeline |
NYSE Composite and Silver Tiger Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Silver Tiger Metals
Pair trading matchups for Silver Tiger
Pair Trading with NYSE Composite and Silver Tiger
The main advantage of trading using opposite NYSE Composite and Silver Tiger positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Silver Tiger 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 Silver Tiger will offset losses from the drop in Silver Tiger's long position.| NYSE Composite vs. Inter Parfums | NYSE Composite vs. Amkor Technology | NYSE Composite vs. Unilever PLC ADR | NYSE Composite vs. Estee Lauder Companies |
| Silver Tiger vs. Defiance Silver Corp | Silver Tiger vs. Summa Silver Corp | Silver Tiger vs. AbraSilver Resource Corp | Silver Tiger vs. Brixton Metals |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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