Correlation Between Catena Media and Catalyst Media
Can any of the company-specific risk be diversified away by investing in both Catena Media 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 Catena Media and Catalyst Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Catena Media PLC and Catalyst Media Group, you can compare the effects of market volatilities on Catena Media 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 Catena Media with a short position of Catalyst Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catena Media and Catalyst Media.
Diversification Opportunities for Catena Media and Catalyst Media
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Catena and Catalyst is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Catena Media PLC 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 Catena Media 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 Catena Media PLC 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 Catena Media i.e., Catena Media and Catalyst Media go up and down completely randomly.
Pair Corralation between Catena Media and Catalyst Media
Assuming the 90 days trading horizon Catena Media PLC is expected to under-perform the Catalyst Media. In addition to that, Catena Media is 2.15 times more volatile than Catalyst Media Group. It trades about -0.21 of its total potential returns per unit of risk. Catalyst Media Group is currently generating about 0.06 per unit of volatility. If you would invest 8,500 in Catalyst Media Group on August 31, 2024 and sell it today you would earn a total of 500.00 from holding Catalyst Media Group or generate 5.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Catena Media PLC vs. Catalyst Media Group
Performance |
| Timeline |
| Catena Media PLC |
| Catalyst Media Group |
Catena Media and Catalyst Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catena Media and Catalyst Media
The main advantage of trading using opposite Catena Media and Catalyst Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catena Media 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.| Catena Media vs. Neometals | Catena Media vs. Coor Service Management | Catena Media vs. Aeorema Communications Plc | Catena Media vs. JLEN Environmental Assets |
| Catalyst Media vs. Aurora Investment Trust | Catalyst Media vs. Panther Metals PLC | Catalyst Media vs. Taylor Maritime Investments | Catalyst Media vs. JB Hunt Transport |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |