Correlation Between NYSE Composite and VerifyMe
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and VerifyMe 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 VerifyMe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and VerifyMe, you can compare the effects of market volatilities on NYSE Composite and VerifyMe 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 VerifyMe. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and VerifyMe.
Diversification Opportunities for NYSE Composite and VerifyMe
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between NYSE and VerifyMe is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and VerifyMe in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VerifyMe 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 VerifyMe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VerifyMe has no effect on the direction of NYSE Composite i.e., NYSE Composite and VerifyMe go up and down completely randomly.
Pair Corralation between NYSE Composite and VerifyMe
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.02 times more return on investment than VerifyMe. However, NYSE Composite is 50.93 times less risky than VerifyMe. It trades about 0.14 of its potential returns per unit of risk. VerifyMe is currently generating about 0.0 per unit of risk. If you would invest 1,951,644 in NYSE Composite on August 29, 2024 and sell it today you would earn a total of 70,301 from holding NYSE Composite or generate 3.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 20.93% |
| Values | Daily Returns |
NYSE Composite vs. VerifyMe
Performance |
| Timeline |
NYSE Composite and VerifyMe Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
VerifyMe
Pair trading matchups for VerifyMe
Pair Trading with NYSE Composite and VerifyMe
The main advantage of trading using opposite NYSE Composite and VerifyMe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, VerifyMe 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 VerifyMe will offset losses from the drop in VerifyMe's long position.| NYSE Composite vs. Sphere Entertainment Co | NYSE Composite vs. Weibo Corp | NYSE Composite vs. BCE Inc | NYSE Composite vs. Pinterest |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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