Correlations

Somebuddy wrote to mention the interesting correlations between various futures. For example, this one which involves gasoline prices. It seemed too slick to be true, so I wandered about and found other neato comparisons. For example: There's a fun spreadsheet here.

 

Correlations

So I was discussing what influences what, in the stock market ... with my brother-in-law. So I generated a spreadsheet that calculated correlations between pairs of assets. Some were to be expected -- but some were surprising. Here's an example: The fascinating thing is to compare daily stock returns when the returns for one asset are delayed a day ... or maybe advanced. So, I calculate the correlation between the Shanghai Index returns and the DOW returns one day later (or earlier). Then, comparing the DOW and Japan: See? The China Index has a higher correlation of daily returns when compared to the DOW returns on the previous market day. That holds, too, for Japan.