Correlation Between CATLIN GROUP and Fidelity National
Can any of the company-specific risk be diversified away by investing in both CATLIN GROUP and Fidelity National 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 Fidelity National into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CATLIN GROUP and Fidelity National Information, you can compare the effects of market volatilities on CATLIN GROUP and Fidelity National 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 Fidelity National. Check out your portfolio center. Please also check ongoing floating volatility patterns of CATLIN GROUP and Fidelity National.
Diversification Opportunities for CATLIN GROUP and Fidelity National
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CATLIN and Fidelity is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding CATLIN GROUP and Fidelity National Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity National 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 Fidelity National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity National has no effect on the direction of CATLIN GROUP i.e., CATLIN GROUP and Fidelity National go up and down completely randomly.
Pair Corralation between CATLIN GROUP and Fidelity National
Assuming the 90 days trading horizon CATLIN GROUP is expected to generate 1.55 times less return on investment than Fidelity National. In addition to that, CATLIN GROUP is 1.4 times more volatile than Fidelity National Information. It trades about 0.06 of its total potential returns per unit of risk. Fidelity National Information is currently generating about 0.13 per unit of volatility. If you would invest 5,812 in Fidelity National Information on September 3, 2024 and sell it today you would earn a total of 2,723 from holding Fidelity National Information or generate 46.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
CATLIN GROUP vs. Fidelity National Information
Performance |
| Timeline |
| CATLIN GROUP |
| Fidelity National |
CATLIN GROUP and Fidelity National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CATLIN GROUP and Fidelity National
The main advantage of trading using opposite CATLIN GROUP and Fidelity National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CATLIN GROUP position performs unexpectedly, Fidelity National 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 Fidelity National will offset losses from the drop in Fidelity National'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 |
| Fidelity National vs. Catalyst Media Group | Fidelity National vs. CATLIN GROUP | Fidelity National vs. Magnora ASA | Fidelity National 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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