Correlation Between NYSE Composite and Harfang Exploration

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Harfang Exploration 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 Harfang Exploration into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Harfang Exploration, you can compare the effects of market volatilities on NYSE Composite and Harfang Exploration 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 Harfang Exploration. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Harfang Exploration.

Diversification Opportunities for NYSE Composite and Harfang Exploration

0.33
  Correlation Coefficient

Weak diversification

The 3 months correlation between NYSE and Harfang is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Harfang Exploration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harfang Exploration 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 Harfang Exploration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harfang Exploration has no effect on the direction of NYSE Composite i.e., NYSE Composite and Harfang Exploration go up and down completely randomly.
    Optimize

Pair Corralation between NYSE Composite and Harfang Exploration

Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.1 times more return on investment than Harfang Exploration. However, NYSE Composite is 9.68 times less risky than Harfang Exploration. It trades about 0.09 of its potential returns per unit of risk. Harfang Exploration is currently generating about 0.0 per unit of risk. If you would invest  1,501,817  in NYSE Composite on September 6, 2024 and sell it today you would earn a total of  517,043  from holding NYSE Composite or generate 34.43% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

NYSE Composite  vs.  Harfang Exploration

 Performance 
       Timeline  

NYSE Composite and Harfang Exploration Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with NYSE Composite and Harfang Exploration

The main advantage of trading using opposite NYSE Composite and Harfang Exploration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Harfang Exploration 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 Harfang Exploration will offset losses from the drop in Harfang Exploration's long position.
The idea behind NYSE Composite and Harfang Exploration 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.
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.

Other Complementary Tools

Bonds Directory
Find actively traded corporate debentures issued by US companies
Crypto Correlations
Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins
Watchlist Optimization
Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm
Cryptocurrency Center
Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency
ETF Categories
List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments