Correlation Between NYSE Composite and SUMITOMO
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By analyzing existing cross correlation between NYSE Composite and SUMITOMO MITSUI FINL, you can compare the effects of market volatilities on NYSE Composite and SUMITOMO 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 SUMITOMO. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and SUMITOMO.
Diversification Opportunities for NYSE Composite and SUMITOMO
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between NYSE and SUMITOMO is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and SUMITOMO MITSUI FINL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SUMITOMO MITSUI FINL 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 SUMITOMO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SUMITOMO MITSUI FINL has no effect on the direction of NYSE Composite i.e., NYSE Composite and SUMITOMO go up and down completely randomly.
Pair Corralation between NYSE Composite and SUMITOMO
Assuming the 90 days trading horizon NYSE Composite is expected to generate 2.48 times more return on investment than SUMITOMO. However, NYSE Composite is 2.48 times more volatile than SUMITOMO MITSUI FINL. It trades about 0.11 of its potential returns per unit of risk. SUMITOMO MITSUI FINL is currently generating about 0.01 per unit of risk. If you would invest 1,535,281 in NYSE Composite on August 31, 2024 and sell it today you would earn a total of 485,701 from holding NYSE Composite or generate 31.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.73% |
| Values | Daily Returns |
NYSE Composite vs. SUMITOMO MITSUI FINL
Performance |
| Timeline |
NYSE Composite and SUMITOMO Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
SUMITOMO MITSUI FINL
Pair trading matchups for SUMITOMO
Pair Trading with NYSE Composite and SUMITOMO
The main advantage of trading using opposite NYSE Composite and SUMITOMO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, SUMITOMO 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 SUMITOMO will offset losses from the drop in SUMITOMO's long position.| NYSE Composite vs. Nextplat Corp | NYSE Composite vs. Qualys Inc | NYSE Composite vs. Cadence Design Systems | NYSE Composite vs. Asure Software |
| SUMITOMO vs. Minerals Technologies | SUMITOMO vs. GMS Inc | SUMITOMO vs. AerSale Corp | SUMITOMO vs. EvoAir 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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