Correlation Between NYSE Composite and Viking Therapeutics
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Viking Therapeutics 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 Viking Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Viking Therapeutics, you can compare the effects of market volatilities on NYSE Composite and Viking Therapeutics 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 Viking Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Viking Therapeutics.
Diversification Opportunities for NYSE Composite and Viking Therapeutics
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NYSE and Viking is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Viking Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Viking Therapeutics 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 Viking Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Viking Therapeutics has no effect on the direction of NYSE Composite i.e., NYSE Composite and Viking Therapeutics go up and down completely randomly.
Pair Corralation between NYSE Composite and Viking Therapeutics
Assuming the 90 days trading horizon NYSE Composite is expected to under-perform the Viking Therapeutics. But the index apears to be less risky and, when comparing its historical volatility, NYSE Composite is 4.67 times less risky than Viking Therapeutics. The index trades about -0.03 of its potential returns per unit of risk. The Viking Therapeutics is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 2,920 in Viking Therapeutics on December 24, 2024 and sell it today you would earn a total of 9.00 from holding Viking Therapeutics or generate 0.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Viking Therapeutics
Performance |
| Timeline |
NYSE Composite and Viking Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Viking Therapeutics
Pair trading matchups for Viking Therapeutics
Pair Trading with NYSE Composite and Viking Therapeutics
The main advantage of trading using opposite NYSE Composite and Viking Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Viking Therapeutics 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 Viking Therapeutics will offset losses from the drop in Viking Therapeutics' long position.| NYSE Composite vs. Globalfoundries | NYSE Composite vs. Arm Holdings plc | NYSE Composite vs. China Tontine Wines | NYSE Composite vs. ASML Holding NV |
| Viking Therapeutics vs. Terns Pharmaceuticals | Viking Therapeutics vs. Akero Therapeutics | Viking Therapeutics vs. Madrigal Pharmaceuticals | Viking Therapeutics vs. Sarepta Therapeutics |
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 Correlations module to find global opportunities by holding instruments from different markets.
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