Correlation Between NYSE Composite and UMF
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and UMF 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 UMF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and UMF Group, you can compare the effects of market volatilities on NYSE Composite and UMF 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 UMF. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and UMF.
Diversification Opportunities for NYSE Composite and UMF
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NYSE and UMF is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and UMF Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UMF Group 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 UMF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UMF Group has no effect on the direction of NYSE Composite i.e., NYSE Composite and UMF go up and down completely randomly.
Pair Corralation between NYSE Composite and UMF
If you would invest 1,945,669 in NYSE Composite on August 30, 2024 and sell it today you would earn a total of 75,313 from holding NYSE Composite or generate 3.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.35% |
| Values | Daily Returns |
NYSE Composite vs. UMF Group
Performance |
| Timeline |
NYSE Composite and UMF Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
UMF Group
Pair trading matchups for UMF
Pair Trading with NYSE Composite and UMF
The main advantage of trading using opposite NYSE Composite and UMF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, UMF 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 UMF will offset losses from the drop in UMF's long position.| NYSE Composite vs. Delek Drilling | NYSE Composite vs. Helmerich and Payne | NYSE Composite vs. Waste Management | NYSE Composite vs. US Global Investors |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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