Correlation Between Catalyst Hedged and Catalystmap Global
Can any of the company-specific risk be diversified away by investing in both Catalyst Hedged and Catalystmap Global 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 Catalyst Hedged and Catalystmap Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Catalyst Hedged Modity and Catalystmap Global Equity, you can compare the effects of market volatilities on Catalyst Hedged and Catalystmap Global 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 Catalyst Hedged with a short position of Catalystmap Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catalyst Hedged and Catalystmap Global.
Diversification Opportunities for Catalyst Hedged and Catalystmap Global
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Catalyst and Catalystmap is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Catalyst Hedged Modity and Catalystmap Global Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalystmap Global Equity and Catalyst Hedged 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 Catalyst Hedged Modity are associated (or correlated) with Catalystmap Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalystmap Global Equity has no effect on the direction of Catalyst Hedged i.e., Catalyst Hedged and Catalystmap Global go up and down completely randomly.
Pair Corralation between Catalyst Hedged and Catalystmap Global
Assuming the 90 days horizon Catalyst Hedged is expected to generate 2.28 times less return on investment than Catalystmap Global. In addition to that, Catalyst Hedged is 1.5 times more volatile than Catalystmap Global Equity. It trades about 0.03 of its total potential returns per unit of risk. Catalystmap Global Equity is currently generating about 0.09 per unit of volatility. If you would invest 1,620 in Catalystmap Global Equity on September 12, 2024 and sell it today you would earn a total of 207.00 from holding Catalystmap Global Equity or generate 12.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Catalyst Hedged Modity vs. Catalystmap Global Equity
Performance |
| Timeline |
| Catalyst Hedged Modity |
| Catalystmap Global Equity |
Catalyst Hedged and Catalystmap Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catalyst Hedged and Catalystmap Global
The main advantage of trading using opposite Catalyst Hedged and Catalystmap Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catalyst Hedged position performs unexpectedly, Catalystmap Global 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 Catalystmap Global will offset losses from the drop in Catalystmap Global's long position.| Catalyst Hedged vs. T Rowe Price | Catalyst Hedged vs. Qs Defensive Growth | Catalyst Hedged vs. Chase Growth Fund | Catalyst Hedged vs. Needham Aggressive Growth |
| Catalystmap Global vs. The National Tax Free | Catalystmap Global vs. Nuveen Minnesota Municipal | Catalystmap Global vs. Counterpoint Tactical Municipal | Catalystmap Global vs. Dws Government Money |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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