Correlation Between Catcher Technology and Celxpert Energy
Can any of the company-specific risk be diversified away by investing in both Catcher Technology and Celxpert Energy 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 Catcher Technology and Celxpert Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Catcher Technology Co and Celxpert Energy, you can compare the effects of market volatilities on Catcher Technology and Celxpert Energy 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 Catcher Technology with a short position of Celxpert Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catcher Technology and Celxpert Energy.
Diversification Opportunities for Catcher Technology and Celxpert Energy
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Catcher and Celxpert is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Catcher Technology Co and Celxpert Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Celxpert Energy and Catcher Technology 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 Catcher Technology Co are associated (or correlated) with Celxpert Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Celxpert Energy has no effect on the direction of Catcher Technology i.e., Catcher Technology and Celxpert Energy go up and down completely randomly.
Pair Corralation between Catcher Technology and Celxpert Energy
Assuming the 90 days trading horizon Catcher Technology Co is expected to under-perform the Celxpert Energy. But the stock apears to be less risky and, when comparing its historical volatility, Catcher Technology Co is 2.63 times less risky than Celxpert Energy. The stock trades about -0.1 of its potential returns per unit of risk. The Celxpert Energy is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 2,465 in Celxpert Energy on November 2, 2024 and sell it today you would earn a total of 1,185 from holding Celxpert Energy or generate 48.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Catcher Technology Co vs. Celxpert Energy
Performance |
| Timeline |
| Catcher Technology |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Celxpert Energy |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
Catcher Technology and Celxpert Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catcher Technology and Celxpert Energy
The main advantage of trading using opposite Catcher Technology and Celxpert Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catcher Technology position performs unexpectedly, Celxpert Energy 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 Celxpert Energy will offset losses from the drop in Celxpert Energy's long position.The idea behind Catcher Technology Co and Celxpert Energy pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |