Correlation Between Catcher Technology and Center Laboratories
Can any of the company-specific risk be diversified away by investing in both Catcher Technology and Center Laboratories 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 Center Laboratories 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 Center Laboratories, you can compare the effects of market volatilities on Catcher Technology and Center Laboratories 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 Center Laboratories. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catcher Technology and Center Laboratories.
Diversification Opportunities for Catcher Technology and Center Laboratories
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Catcher and Center is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Catcher Technology Co and Center Laboratories in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Center Laboratories 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 Center Laboratories. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Center Laboratories has no effect on the direction of Catcher Technology i.e., Catcher Technology and Center Laboratories go up and down completely randomly.
Pair Corralation between Catcher Technology and Center Laboratories
Assuming the 90 days trading horizon Catcher Technology Co is expected to under-perform the Center Laboratories. But the stock apears to be less risky and, when comparing its historical volatility, Catcher Technology Co is 1.17 times less risky than Center Laboratories. The stock trades about -0.31 of its potential returns per unit of risk. The Center Laboratories is currently generating about -0.12 of returns per unit of risk over similar time horizon. If you would invest 4,945 in Center Laboratories on September 4, 2024 and sell it today you would lose (345.00) from holding Center Laboratories or give up 6.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Catcher Technology Co vs. Center Laboratories
Performance |
| Timeline |
| Catcher Technology |
| Center Laboratories |
Catcher Technology and Center Laboratories Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catcher Technology and Center Laboratories
The main advantage of trading using opposite Catcher Technology and Center Laboratories positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catcher Technology position performs unexpectedly, Center Laboratories 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 Center Laboratories will offset losses from the drop in Center Laboratories' long position.| Catcher Technology vs. Taiwan Semiconductor Manufacturing | Catcher Technology vs. Yang Ming Marine | Catcher Technology vs. AU Optronics | Catcher Technology vs. Innolux Corp |
| Center Laboratories vs. TTY Biopharm Co | Center Laboratories vs. TCI Co | Center Laboratories vs. Synmosa Biopharma | Center Laboratories vs. Adimmune Corp |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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