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
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Schroders and Catalyst is -0.4. 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 generate 0.54 times more return on investment than Catalyst Media. However, Schroders Investment Trusts is 1.85 times less risky than Catalyst Media. It trades about 0.04 of its potential returns per unit of risk. Catalyst Media Group is currently generating about -0.04 per unit of risk. If you would invest 42,255 in Schroders Investment Trusts on October 23, 2024 and sell it today you would earn a total of 7,095 from holding Schroders Investment Trusts or generate 16.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.8% |
| 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. First Class Metals | Schroders Investment vs. Trainline Plc | Schroders Investment vs. Coeur Mining | Schroders Investment vs. AMG Advanced Metallurgical |
| Catalyst Media vs. Veolia Environnement VE | Catalyst Media vs. Schroders Investment Trusts | Catalyst Media vs. EJF Investments | Catalyst Media vs. Vietnam Enterprise Investments |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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