Market Measures - July 16, 2021 - Post-Pandemic Correlations

published 1 week ago by tastytrade, Inc.

Correlations are said to go to +1 or -1 in times of market stress, we found this broadly true in turbulent market conditions.We looked at correlations during and after the recent March 2020 selloff to see if there remain significant changes in market dynamics and correlations.Understanding correlations during times of stress and in the current market is critical. Trading different symbols and strategies improves diversification to create a portfolio that benefits from all types of market movement.

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