Two Equities Correlation Analysis
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This model provides you with a quick lookup of cross correlation between two equities. Please specify two instruments to run the correlation.
Diversification Opportunities for Dollar General and NYSE Composite
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Dollar and NYSE is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Dollar General and NYSE Composite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NYSE Composite and Dollar General 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 Dollar General are associated (or correlated) with NYSE Composite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NYSE Composite has no effect on the direction of Dollar General i.e., Dollar General and NYSE Composite go up and down completely randomly.
Pair Corralation between Dollar General and NYSE Composite
Allowing for the 90-day total investment horizon Dollar General is expected to generate 3.27 times more return on investment than NYSE Composite. However, Dollar General is 3.27 times more volatile than NYSE Composite. It trades about 0.04 of its potential returns per unit of risk. NYSE Composite is currently generating about 0.01 per unit of risk. If you would invest 14,196 in Dollar General on January 20, 2024 and sell it today you would earn a total of 372.00 from holding Dollar General or generate 2.62% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Dollar General vs. NYSE Composite
Performance |
Timeline |
Dollar General and NYSE Composite Volatility Contrast
Predicted Return Density |
Returns |
Dollar General
Pair trading matchups for Dollar General
NYSE Composite
Pair trading matchups for NYSE Composite
Pair Trading with Dollar General and NYSE Composite
The main advantage of trading using opposite Dollar General and NYSE Composite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dollar General position performs unexpectedly, NYSE Composite 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 NYSE Composite will offset losses from the drop in NYSE Composite's long position.Dollar General vs. Aquagold International | Dollar General vs. Morningstar Unconstrained Allocation | Dollar General vs. Thrivent High Yield | Dollar General vs. Via Renewables |
NYSE Composite vs. Dine Brands Global | NYSE Composite vs. BJs Restaurants | NYSE Composite vs. Chipotle Mexican Grill | NYSE Composite vs. Shake Shack |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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