Correlation Between NYSE Composite and TriMas
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and TriMas 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 TriMas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and TriMas, you can compare the effects of market volatilities on NYSE Composite and TriMas 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 TriMas. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and TriMas.
Diversification Opportunities for NYSE Composite and TriMas
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NYSE and TriMas is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and TriMas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TriMas 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 TriMas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TriMas has no effect on the direction of NYSE Composite i.e., NYSE Composite and TriMas go up and down completely randomly.
Pair Corralation between NYSE Composite and TriMas
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.41 times more return on investment than TriMas. However, NYSE Composite is 2.41 times less risky than TriMas. It trades about 0.11 of its potential returns per unit of risk. TriMas is currently generating about 0.0 per unit of risk. If you would invest 1,550,264 in NYSE Composite on August 31, 2024 and sell it today you would earn a total of 476,940 from holding NYSE Composite or generate 30.77% 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. TriMas
Performance |
| Timeline |
NYSE Composite and TriMas Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
TriMas
Pair trading matchups for TriMas
Pair Trading with NYSE Composite and TriMas
The main advantage of trading using opposite NYSE Composite and TriMas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, TriMas 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 TriMas will offset losses from the drop in TriMas' long position.| NYSE Composite vs. Nextplat Corp | NYSE Composite vs. Qualys Inc | NYSE Composite vs. Cadence Design Systems | NYSE Composite vs. Asure Software |
| TriMas vs. Greif Bros | TriMas vs. Karat Packaging | TriMas vs. Reynolds Consumer Products | TriMas vs. Silgan Holdings |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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