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Correlation Between Nasdaq and CME

Analyzing existing cross correlation between Nasdaq and CME Group. You can compare the effects of market volatilities on Nasdaq and CME 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 Nasdaq with a short position of CME. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nasdaq and CME.
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Comparative Performance

Nasdaq  
1212

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in Nasdaq are ranked lower than 12 (%) of all global equities and portfolios over the last 30 days. Inspite very unsteady forward-looking indicators, Nasdaq may actually be approaching a critical reversion point that can send shares even higher in March 2020.
CME Group  
44

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in CME Group are ranked lower than 4 (%) of all global equities and portfolios over the last 30 days. In spite of rather sound fundamental drivers, CME is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Nasdaq and CME Volatility Contrast

 Predicted Return Density 
    
  Returns 

Nasdaq Inc  vs.  CME Group

 Performance (%) 
    
  Timeline 

Pair Volatility

Given the investment horizon of 30 days, Nasdaq is expected to generate 0.91 times more return on investment than CME. However, Nasdaq is 1.1 times less risky than CME. It trades about 0.19 of its potential returns per unit of risk. CME Group is currently generating about 0.07 per unit of risk. If you would invest  10,474  in Nasdaq on January 20, 2020 and sell it today you would earn a total of  1,093  from holding Nasdaq or generate 10.44% return on investment over 30 days.

Pair Corralation between Nasdaq and CME

0.8
Time Period3 Months [change]
DirectionPositive 
StrengthStrong
Accuracy98.39%
ValuesDaily Returns

Diversification Opportunities for Nasdaq and CME

Nasdaq Inc diversification synergy

Very poor diversification

Overlapping area represents the amount of risk that can be diversified away by holding Nasdaq Inc and CME Group in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on CME Group and Nasdaq 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 Nasdaq are associated (or correlated) with CME. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CME Group has no effect on the direction of Nasdaq i.e. Nasdaq and CME go up and down completely randomly.
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