Correlation Between NYSE Composite and Farmers Merchants
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Farmers Merchants 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 Farmers Merchants into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Farmers Merchants Bancorp, you can compare the effects of market volatilities on NYSE Composite and Farmers Merchants 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 Farmers Merchants. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Farmers Merchants.
Diversification Opportunities for NYSE Composite and Farmers Merchants
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between NYSE and Farmers is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Farmers Merchants Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Farmers Merchants Bancorp 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 Farmers Merchants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Farmers Merchants Bancorp has no effect on the direction of NYSE Composite i.e., NYSE Composite and Farmers Merchants go up and down completely randomly.
Pair Corralation between NYSE Composite and Farmers Merchants
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.38 times more return on investment than Farmers Merchants. However, NYSE Composite is 2.64 times less risky than Farmers Merchants. It trades about 0.02 of its potential returns per unit of risk. Farmers Merchants Bancorp is currently generating about -0.1 per unit of risk. If you would invest 1,907,793 in NYSE Composite on December 29, 2024 and sell it today you would earn a total of 19,237 from holding NYSE Composite or generate 1.01% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
NYSE Composite vs. Farmers Merchants Bancorp
Performance |
Timeline |
NYSE Composite and Farmers Merchants Volatility Contrast
Predicted Return Density |
Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Farmers Merchants Bancorp
Pair trading matchups for Farmers Merchants
Pair Trading with NYSE Composite and Farmers Merchants
The main advantage of trading using opposite NYSE Composite and Farmers Merchants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Farmers Merchants 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 Farmers Merchants will offset losses from the drop in Farmers Merchants' long position.NYSE Composite vs. Cimpress NV | NYSE Composite vs. NorthWestern | NYSE Composite vs. BOS Better Online | NYSE Composite vs. California Water Service |
Farmers Merchants vs. Home Bancorp | Farmers Merchants vs. Rhinebeck Bancorp | Farmers Merchants vs. LINKBANCORP | Farmers Merchants vs. Magyar Bancorp |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
CEOs Directory Screen CEOs from public companies around the world | |
Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |