Correlation Between Catena Media and Supply@Me Capital
Can any of the company-specific risk be diversified away by investing in both Catena Media and Supply@Me Capital 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 Supply@Me Capital 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 SupplyMe Capital PLC, you can compare the effects of market volatilities on Catena Media and Supply@Me Capital 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 Supply@Me Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catena Media and Supply@Me Capital.
Diversification Opportunities for Catena Media and Supply@Me Capital
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Catena and Supply@Me is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Catena Media PLC and SupplyMe Capital PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SupplyMe Capital PLC 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 Supply@Me Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SupplyMe Capital PLC has no effect on the direction of Catena Media i.e., Catena Media and Supply@Me Capital go up and down completely randomly.
Pair Corralation between Catena Media and Supply@Me Capital
Assuming the 90 days trading horizon Catena Media PLC is expected to generate 0.58 times more return on investment than Supply@Me Capital. However, Catena Media PLC is 1.72 times less risky than Supply@Me Capital. It trades about -0.07 of its potential returns per unit of risk. SupplyMe Capital PLC is currently generating about -0.1 per unit of risk. If you would invest 1,002 in Catena Media PLC on August 29, 2024 and sell it today you would lose (572.00) from holding Catena Media PLC or give up 57.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Catena Media PLC vs. SupplyMe Capital PLC
Performance |
| Timeline |
| Catena Media PLC |
| SupplyMe Capital PLC |
Catena Media and Supply@Me Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catena Media and Supply@Me Capital
The main advantage of trading using opposite Catena Media and Supply@Me Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catena Media position performs unexpectedly, Supply@Me Capital 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 Supply@Me Capital will offset losses from the drop in Supply@Me Capital's long position.| Catena Media vs. Lendinvest PLC | Catena Media vs. Neometals | Catena Media vs. Coor Service Management | Catena Media vs. Albion Technology General |
| Supply@Me Capital vs. Alaska Air Group | Supply@Me Capital vs. Delta Air Lines | Supply@Me Capital vs. Deltex Medical Group | Supply@Me Capital vs. Finnair Oyj |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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