Correlation Between NYSE Composite and SOUTHERN
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By analyzing existing cross correlation between NYSE Composite and SOUTHERN CALIF GAS, you can compare the effects of market volatilities on NYSE Composite and SOUTHERN 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 SOUTHERN. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and SOUTHERN.
Diversification Opportunities for NYSE Composite and SOUTHERN
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between NYSE and SOUTHERN is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and SOUTHERN CALIF GAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SOUTHERN CALIF GAS 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 SOUTHERN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SOUTHERN CALIF GAS has no effect on the direction of NYSE Composite i.e., NYSE Composite and SOUTHERN go up and down completely randomly.
Pair Corralation between NYSE Composite and SOUTHERN
Assuming the 90 days trading horizon NYSE Composite is expected to under-perform the SOUTHERN. But the index apears to be less risky and, when comparing its historical volatility, NYSE Composite is 1.6 times less risky than SOUTHERN. The index trades about -0.07 of its potential returns per unit of risk. The SOUTHERN CALIF GAS is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 8,399 in SOUTHERN CALIF GAS on September 12, 2024 and sell it today you would earn a total of 177.00 from holding SOUTHERN CALIF GAS or generate 2.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 71.43% |
| Values | Daily Returns |
NYSE Composite vs. SOUTHERN CALIF GAS
Performance |
| Timeline |
NYSE Composite and SOUTHERN Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
SOUTHERN CALIF GAS
Pair trading matchups for SOUTHERN
Pair Trading with NYSE Composite and SOUTHERN
The main advantage of trading using opposite NYSE Composite and SOUTHERN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, SOUTHERN 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 SOUTHERN will offset losses from the drop in SOUTHERN's long position.| NYSE Composite vs. Teleflex Incorporated | NYSE Composite vs. Victorias Secret Co | NYSE Composite vs. Under Armour C | NYSE Composite vs. Steven Madden |
| SOUTHERN vs. AEP TEX INC | SOUTHERN vs. US BANK NATIONAL | SOUTHERN vs. PayPal Holdings | SOUTHERN vs. Alphabet Inc Class C |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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