Correlation Between CATLIN GROUP and Qurate Retail
Can any of the company-specific risk be diversified away by investing in both CATLIN GROUP and Qurate Retail 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 CATLIN GROUP and Qurate Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CATLIN GROUP and Qurate Retail Series, you can compare the effects of market volatilities on CATLIN GROUP and Qurate Retail 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 CATLIN GROUP with a short position of Qurate Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of CATLIN GROUP and Qurate Retail.
Diversification Opportunities for CATLIN GROUP and Qurate Retail
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CATLIN and Qurate is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding CATLIN GROUP and Qurate Retail Series in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qurate Retail Series and CATLIN GROUP 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 CATLIN GROUP are associated (or correlated) with Qurate Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qurate Retail Series has no effect on the direction of CATLIN GROUP i.e., CATLIN GROUP and Qurate Retail go up and down completely randomly.
Pair Corralation between CATLIN GROUP and Qurate Retail
Assuming the 90 days trading horizon CATLIN GROUP is expected to generate 0.44 times more return on investment than Qurate Retail. However, CATLIN GROUP is 2.3 times less risky than Qurate Retail. It trades about 0.07 of its potential returns per unit of risk. Qurate Retail Series is currently generating about -0.08 per unit of risk. If you would invest 7,800 in CATLIN GROUP on September 3, 2024 and sell it today you would earn a total of 1,600 from holding CATLIN GROUP or generate 20.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.67% |
| Values | Daily Returns |
CATLIN GROUP vs. Qurate Retail Series
Performance |
| Timeline |
| CATLIN GROUP |
| Qurate Retail Series |
CATLIN GROUP and Qurate Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CATLIN GROUP and Qurate Retail
The main advantage of trading using opposite CATLIN GROUP and Qurate Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CATLIN GROUP position performs unexpectedly, Qurate Retail 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 Qurate Retail will offset losses from the drop in Qurate Retail's long position.| CATLIN GROUP vs. Molson Coors Beverage | CATLIN GROUP vs. Flowtech Fluidpower plc | CATLIN GROUP vs. CleanTech Lithium plc | CATLIN GROUP vs. Monster Beverage Corp |
| Qurate Retail vs. Catalyst Media Group | Qurate Retail vs. CATLIN GROUP | Qurate Retail vs. Magnora ASA | Qurate Retail vs. RTW Venture Fund |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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