Correlation Between 00037BAF9 and NYSE Composite
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By analyzing existing cross correlation between ABB FIN USA and NYSE Composite, you can compare the effects of market volatilities on 00037BAF9 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 00037BAF9 with a short position of NYSE Composite. Check out your portfolio center. Please also check ongoing floating volatility patterns of 00037BAF9 and NYSE Composite.
Diversification Opportunities for 00037BAF9 and NYSE Composite
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 00037BAF9 and NYSE is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding ABB FIN USA and NYSE Composite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NYSE Composite and 00037BAF9 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 ABB FIN USA 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 00037BAF9 i.e., 00037BAF9 and NYSE Composite go up and down completely randomly.
Pair Corralation between 00037BAF9 and NYSE Composite
Assuming the 90 days trading horizon ABB FIN USA is expected to under-perform the NYSE Composite. But the bond apears to be less risky and, when comparing its historical volatility, ABB FIN USA is 1.2 times less risky than NYSE Composite. The bond trades about -0.37 of its potential returns per unit of risk. The NYSE Composite is currently generating about -0.23 of returns per unit of risk over similar time horizon. If you would invest 1,797,579 in NYSE Composite on January 19, 2024 and sell it today you would lose (57,235) from holding NYSE Composite or give up 3.18% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 28.57% |
Values | Daily Returns |
ABB FIN USA vs. NYSE Composite
Performance |
Timeline |
00037BAF9 and NYSE Composite Volatility Contrast
Predicted Return Density |
Returns |
ABB FIN USA
Pair trading matchups for 00037BAF9
NYSE Composite
Pair trading matchups for NYSE Composite
Pair Trading with 00037BAF9 and NYSE Composite
The main advantage of trading using opposite 00037BAF9 and NYSE Composite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 00037BAF9 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.The idea behind ABB FIN USA and NYSE Composite pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.NYSE Composite vs. Western Digital | NYSE Composite vs. Meta Data | NYSE Composite vs. Transphorm Technology | NYSE Composite vs. Playtika Holding Corp |
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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