Correlation Between Schroders Investment and Catalyst Media
Can any of the company-specific risk be diversified away by investing in both Schroders Investment 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 Schroders Investment and Catalyst Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Schroders Investment Trusts and Catalyst Media Group, you can compare the effects of market volatilities on Schroders Investment 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 Schroders Investment with a short position of Catalyst Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Schroders Investment and Catalyst Media.
Diversification Opportunities for Schroders Investment and Catalyst Media
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Schroders and Catalyst is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Schroders Investment Trusts 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 Schroders Investment 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 Schroders Investment Trusts 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 Schroders Investment i.e., Schroders Investment and Catalyst Media go up and down completely randomly.
Pair Corralation between Schroders Investment and Catalyst Media
Assuming the 90 days trading horizon Schroders Investment Trusts is expected to under-perform the Catalyst Media. But the stock apears to be less risky and, when comparing its historical volatility, Schroders Investment Trusts is 3.79 times less risky than Catalyst Media. The stock trades about -0.01 of its potential returns per unit of risk. The Catalyst Media Group is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 9,500 in Catalyst Media Group on August 26, 2024 and sell it today you would earn a total of 150.00 from holding Catalyst Media Group or generate 1.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Schroders Investment Trusts vs. Catalyst Media Group
Performance |
| Timeline |
| Schroders Investment |
| Catalyst Media Group |
Schroders Investment and Catalyst Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Schroders Investment and Catalyst Media
The main advantage of trading using opposite Schroders Investment and Catalyst Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Schroders Investment 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.| Schroders Investment vs. Catalyst Media Group | Schroders Investment vs. Oncimmune Holdings plc | Schroders Investment vs. Invesco Health Care | Schroders Investment vs. Coor Service Management |
| Catalyst Media vs. Toyota Motor Corp | Catalyst Media vs. SoftBank Group Corp | Catalyst Media vs. Fannie Mae | Catalyst Media vs. Panasonic 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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