Correlation Between NYSE Composite and Global Partner

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Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Global Partner 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 Global Partner into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Global Partner Acq, you can compare the effects of market volatilities on NYSE Composite and Global Partner 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 Global Partner. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Global Partner.

Diversification Opportunities for NYSE Composite and Global Partner

NYSEGlobalDiversified AwayNYSEGlobalDiversified Away100%
0.16
  Correlation Coefficient

Average diversification

The 3 months correlation between NYSE and Global is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Global Partner Acq in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Partner Acq 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 Global Partner. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Partner Acq has no effect on the direction of NYSE Composite i.e., NYSE Composite and Global Partner go up and down completely randomly.
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Pair Corralation between NYSE Composite and Global Partner

If you would invest  1,003  in Global Partner Acq on September 25, 2024 and sell it today you would earn a total of  0.00  from holding Global Partner Acq or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy1.59%
ValuesDaily Returns

NYSE Composite  vs.  Global Partner Acq

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec -6-4-2024
JavaScript chart by amCharts 3.21.15NYA GPACU
       Timeline  

NYSE Composite and Global Partner Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-1.0-0.72-0.44-0.16-0.010.110.390.670.951.23 0.20.40.60.8
JavaScript chart by amCharts 3.21.15NYA GPACU
       Returns  

Pair Trading with NYSE Composite and Global Partner

The main advantage of trading using opposite NYSE Composite and Global Partner positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Global Partner 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 Global Partner will offset losses from the drop in Global Partner's long position.
The idea behind NYSE Composite and Global Partner Acq 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.
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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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