Correlation Between NYSE Composite and Thompson Bond
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Thompson Bond 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 Thompson Bond into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Thompson Bond Fund, you can compare the effects of market volatilities on NYSE Composite and Thompson Bond 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 Thompson Bond. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Thompson Bond.
Diversification Opportunities for NYSE Composite and Thompson Bond
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NYSE and Thompson is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Thompson Bond Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thompson Bond 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 Thompson Bond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thompson Bond has no effect on the direction of NYSE Composite i.e., NYSE Composite and Thompson Bond go up and down completely randomly.
Pair Corralation between NYSE Composite and Thompson Bond
Assuming the 90 days trading horizon NYSE Composite is expected to generate 5.77 times more return on investment than Thompson Bond. However, NYSE Composite is 5.77 times more volatile than Thompson Bond Fund. It trades about 0.23 of its potential returns per unit of risk. Thompson Bond Fund is currently generating about 0.41 per unit of risk. If you would invest 1,954,967 in NYSE Composite on August 29, 2024 and sell it today you would earn a total of 66,015 from holding NYSE Composite or generate 3.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Thompson Bond Fund
Performance |
| Timeline |
NYSE Composite and Thompson Bond Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Thompson Bond Fund
Pair trading matchups for Thompson Bond
Pair Trading with NYSE Composite and Thompson Bond
The main advantage of trading using opposite NYSE Composite and Thompson Bond positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Thompson Bond 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 Thompson Bond will offset losses from the drop in Thompson Bond's long position.| NYSE Composite vs. Sphere Entertainment Co | NYSE Composite vs. Weibo Corp | NYSE Composite vs. BCE Inc | NYSE Composite vs. Pinterest |
| Thompson Bond vs. Tcw Total Return | Thompson Bond vs. Amg Yacktman Focused | Thompson Bond vs. Fidelity Advisor Floating | Thompson Bond vs. Doubleline Total Return |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
Other Complementary Tools
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |