Correlation Between NYSE Composite and WhiteHorse Finance
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and WhiteHorse Finance 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 WhiteHorse Finance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and WhiteHorse Finance, you can compare the effects of market volatilities on NYSE Composite and WhiteHorse Finance 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 WhiteHorse Finance. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and WhiteHorse Finance.
Diversification Opportunities for NYSE Composite and WhiteHorse Finance
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NYSE and WhiteHorse is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and WhiteHorse Finance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WhiteHorse Finance 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 WhiteHorse Finance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WhiteHorse Finance has no effect on the direction of NYSE Composite i.e., NYSE Composite and WhiteHorse Finance go up and down completely randomly.
Pair Corralation between NYSE Composite and WhiteHorse Finance
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.49 times more return on investment than WhiteHorse Finance. However, NYSE Composite is 2.04 times less risky than WhiteHorse Finance. It trades about 0.29 of its potential returns per unit of risk. WhiteHorse Finance is currently generating about -0.38 per unit of risk. If you would invest 1,941,627 in NYSE Composite on August 31, 2024 and sell it today you would earn a total of 79,355 from holding NYSE Composite or generate 4.09% 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. WhiteHorse Finance
Performance |
| Timeline |
NYSE Composite and WhiteHorse Finance Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
WhiteHorse Finance
Pair trading matchups for WhiteHorse Finance
Pair Trading with NYSE Composite and WhiteHorse Finance
The main advantage of trading using opposite NYSE Composite and WhiteHorse Finance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, WhiteHorse Finance 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 WhiteHorse Finance will offset losses from the drop in WhiteHorse Finance's long position.| NYSE Composite vs. Nextplat Corp | NYSE Composite vs. Qualys Inc | NYSE Composite vs. Cadence Design Systems | NYSE Composite vs. Asure Software |
| WhiteHorse Finance vs. Ares Capital | WhiteHorse Finance vs. Hercules Capital | WhiteHorse Finance vs. Main Street Capital |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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