Correlation Between NYSE Composite and Verint Systems
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Verint Systems 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 Verint Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Verint Systems, you can compare the effects of market volatilities on NYSE Composite and Verint Systems 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 Verint Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Verint Systems.
Diversification Opportunities for NYSE Composite and Verint Systems
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between NYSE and Verint is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Verint Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Verint Systems 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 Verint Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Verint Systems has no effect on the direction of NYSE Composite i.e., NYSE Composite and Verint Systems go up and down completely randomly.
Pair Corralation between NYSE Composite and Verint Systems
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.23 times more return on investment than Verint Systems. However, NYSE Composite is 4.38 times less risky than Verint Systems. It trades about 0.1 of its potential returns per unit of risk. Verint Systems is currently generating about -0.03 per unit of risk. If you would invest 1,617,454 in NYSE Composite on August 26, 2024 and sell it today you would earn a total of 394,891 from holding NYSE Composite or generate 24.41% 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. Verint Systems
Performance |
| Timeline |
NYSE Composite and Verint Systems Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Verint Systems
Pair trading matchups for Verint Systems
Pair Trading with NYSE Composite and Verint Systems
The main advantage of trading using opposite NYSE Composite and Verint Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Verint Systems 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 Verint Systems will offset losses from the drop in Verint Systems' long position.| NYSE Composite vs. Glacier Bancorp | NYSE Composite vs. LithiumBank Resources Corp | NYSE Composite vs. Stepstone Group | NYSE Composite vs. Pintec Technology Holdings |
| Verint Systems vs. GigaCloud Technology Class | Verint Systems vs. Arqit Quantum | Verint Systems vs. Telos Corp | Verint Systems vs. Cemtrex |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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