Correlation Between AcadeMedia and Catalyst Media
Can any of the company-specific risk be diversified away by investing in both AcadeMedia and Catalyst Media 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 AcadeMedia and Catalyst Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AcadeMedia AB and Catalyst Media Group, you can compare the effects of market volatilities on AcadeMedia and Catalyst Media 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 AcadeMedia with a short position of Catalyst Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of AcadeMedia and Catalyst Media.
Diversification Opportunities for AcadeMedia and Catalyst Media
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between AcadeMedia and Catalyst is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding AcadeMedia AB and Catalyst Media Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalyst Media Group and AcadeMedia 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 AcadeMedia AB are associated (or correlated) with Catalyst Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalyst Media Group has no effect on the direction of AcadeMedia i.e., AcadeMedia and Catalyst Media go up and down completely randomly.
Pair Corralation between AcadeMedia and Catalyst Media
Assuming the 90 days trading horizon AcadeMedia AB is expected to generate 0.57 times more return on investment than Catalyst Media. However, AcadeMedia AB is 1.74 times less risky than Catalyst Media. It trades about 0.1 of its potential returns per unit of risk. Catalyst Media Group is currently generating about -0.06 per unit of risk. If you would invest 4,872 in AcadeMedia AB on January 25, 2025 and sell it today you would earn a total of 3,208 from holding AcadeMedia AB or generate 65.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.72% |
| Values | Daily Returns |
AcadeMedia AB vs. Catalyst Media Group
Performance |
| Timeline |
| AcadeMedia AB |
| Catalyst Media Group |
AcadeMedia and Catalyst Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AcadeMedia and Catalyst Media
The main advantage of trading using opposite AcadeMedia and Catalyst Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AcadeMedia position performs unexpectedly, Catalyst Media 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 Catalyst Media will offset losses from the drop in Catalyst Media's long position.| AcadeMedia vs. Bytes Technology | AcadeMedia vs. Zegona Communications Plc | AcadeMedia vs. Allianz Technology Trust | AcadeMedia vs. Batm Advanced Communications |
| Catalyst Media vs. Software Circle plc | Catalyst Media vs. Liontrust Asset Management | Catalyst Media vs. United Internet AG | Catalyst Media vs. Aeorema Communications Plc |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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