Correlation Between NYSE Composite and CHEVRON
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By analyzing existing cross correlation between NYSE Composite and CHEVRON USA INC, you can compare the effects of market volatilities on NYSE Composite and CHEVRON 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 CHEVRON. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and CHEVRON.
Diversification Opportunities for NYSE Composite and CHEVRON
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between NYSE and CHEVRON is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and CHEVRON USA INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHEVRON USA INC 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 CHEVRON. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHEVRON USA INC has no effect on the direction of NYSE Composite i.e., NYSE Composite and CHEVRON go up and down completely randomly.
Pair Corralation between NYSE Composite and CHEVRON
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.65 times more return on investment than CHEVRON. However, NYSE Composite is 1.55 times less risky than CHEVRON. It trades about 0.13 of its potential returns per unit of risk. CHEVRON USA INC is currently generating about -0.04 per unit of risk. If you would invest 1,691,113 in NYSE Composite on August 28, 2024 and sell it today you would earn a total of 330,923 from holding NYSE Composite or generate 19.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 67.94% |
| Values | Daily Returns |
NYSE Composite vs. CHEVRON USA INC
Performance |
| Timeline |
NYSE Composite and CHEVRON Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
CHEVRON USA INC
Pair trading matchups for CHEVRON
Pair Trading with NYSE Composite and CHEVRON
The main advantage of trading using opposite NYSE Composite and CHEVRON positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, CHEVRON 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 CHEVRON will offset losses from the drop in CHEVRON's long position.| NYSE Composite vs. Vita Coco | NYSE Composite vs. Franklin Wireless Corp | NYSE Composite vs. Ambev SA ADR | NYSE Composite vs. Toro Co |
| CHEVRON vs. Saia Inc | CHEVRON vs. SunLink Health Systems | CHEVRON vs. Delek Logistics Partners | CHEVRON vs. Simon Property Group |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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