Map · Correlation
The raw and cleaned forms of the relationships the map rests on, side by side.
Raw and residual return correlation heatmaps
What it is: On the left the correlation matrix between stocks of raw returns, on the right that of residual returns.
What data feeds it: The correlation result of the latest analysis run, last 500 trading days, at least 60 common observations. At most 80 stocks are shown for readability.
What it shows: Blue is positive, red negative correlation. The raw matrix being almost entirely blue shows that all stocks move together with the market.
What can be concluded from it: The difference between the two matrices is the apparent relationship created by the common market movement. All analyses in the application are done on the matrix on the right; a fabric model built on the left one would mistake the market itself for "propagation".
The investment information, comments and recommendations given here are not within the scope of investment advisory services. Investment advisory services are provided under an investment advisory agreement to be signed between a client and brokerage houses, portfolio management companies, or banks that do not accept deposits. The signals here are produced from historical data with statistical models, are shown the same to everyone and are not personalised; they may not suit your financial situation or your risk and return preferences. Therefore, making investment decisions based solely on the information given here may not produce results that meet your expectations.