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 Alleghany and NYSE Composite
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Alleghany and NYSE is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Alleghany and NYSE Composite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NYSE Composite and Alleghany 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 Alleghany 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 Alleghany i.e., Alleghany and NYSE Composite go up and down completely randomly.
Pair Corralation between Alleghany and NYSE Composite
If you would invest 84,779 in Alleghany on January 25, 2024 and sell it today you would earn a total of 0.00 from holding Alleghany or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Alleghany vs. NYSE Composite
Performance |
| Timeline |
Alleghany and NYSE Composite Volatility Contrast
Predicted Return Density |
| Returns |
Alleghany
Pair trading matchups for Alleghany
NYSE Composite
Pair trading matchups for NYSE Composite
Pair Trading with Alleghany and NYSE Composite
The main advantage of trading using opposite Alleghany and NYSE Composite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alleghany 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.| Alleghany vs. Jeld Wen Holding | Alleghany vs. ChampionX | Alleghany vs. Tyson Foods | Alleghany vs. Wicket Gaming AB |
| NYSE Composite vs. Aduro Clean Technologies | NYSE Composite vs. Transphorm Technology | NYSE Composite vs. Advanced Micro Devices | NYSE Composite vs. IPG Photonics |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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