Correlation Between Conflux Network and NYSE Composite
Can any of the company-specific risk be diversified away by investing in both Conflux Network and NYSE Composite 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 Conflux Network and NYSE Composite into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Conflux Network and NYSE Composite, you can compare the effects of market volatilities on Conflux Network and NYSE Composite 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 Conflux Network with a short position of NYSE Composite. Check out your portfolio center. Please also check ongoing floating volatility patterns of Conflux Network and NYSE Composite.
Diversification Opportunities for Conflux Network and NYSE Composite
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Conflux and NYSE is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Conflux Network and NYSE Composite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NYSE Composite and Conflux Network 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 Conflux Network 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 Conflux Network i.e., Conflux Network and NYSE Composite go up and down completely randomly.
Pair Corralation between Conflux Network and NYSE Composite
Assuming the 90 days trading horizon Conflux Network is expected to under-perform the NYSE Composite. In addition to that, Conflux Network is 12.2 times more volatile than NYSE Composite. It trades about -0.15 of its total potential returns per unit of risk. NYSE Composite is currently generating about 0.05 per unit of volatility. If you would invest 1,811,204 in NYSE Composite on February 21, 2024 and sell it today you would earn a total of 22,587 from holding NYSE Composite or generate 1.25% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 97.67% |
Values | Daily Returns |
Conflux Network vs. NYSE Composite
Performance |
Timeline |
Conflux Network and NYSE Composite Volatility Contrast
Predicted Return Density |
Returns |
Conflux Network
Pair trading matchups for Conflux Network
NYSE Composite
Pair trading matchups for NYSE Composite
Pair Trading with Conflux Network and NYSE Composite
The main advantage of trading using opposite Conflux Network and NYSE Composite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Conflux Network 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.Conflux Network vs. Staked Ether | Conflux Network vs. XCAD Network | Conflux Network vs. Phala Network | Conflux Network vs. Synapse |
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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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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