Correlation Between NYSE Composite and Security Bank
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Security Bank 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 Security Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Security Bank, you can compare the effects of market volatilities on NYSE Composite and Security Bank 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 Security Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Security Bank.
Diversification Opportunities for NYSE Composite and Security Bank
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between NYSE and Security is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Security Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Security Bank 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 Security Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Security Bank has no effect on the direction of NYSE Composite i.e., NYSE Composite and Security Bank go up and down completely randomly.
Pair Corralation between NYSE Composite and Security Bank
If you would invest 1,912,150 in NYSE Composite on September 13, 2024 and sell it today you would earn a total of 76,953 from holding NYSE Composite or generate 4.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 1.59% |
| Values | Daily Returns |
NYSE Composite vs. Security Bank
Performance |
| Timeline |
NYSE Composite and Security Bank Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Security Bank
Pair trading matchups for Security Bank
Pair Trading with NYSE Composite and Security Bank
The main advantage of trading using opposite NYSE Composite and Security Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Security Bank 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 Security Bank will offset losses from the drop in Security Bank's long position.| NYSE Composite vs. Boston Beer | NYSE Composite vs. Freedom Bank of | NYSE Composite vs. KeyCorp | NYSE Composite vs. LithiumBank Resources Corp |
| Security Bank vs. Merchants Marine Bancorp | Security Bank vs. First Bancorp | Security Bank vs. CNB Financial | Security Bank vs. MNB Holdings Corp |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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