Correlation Between CATLIN GROUP and Schroders Investment
Can any of the company-specific risk be diversified away by investing in both CATLIN GROUP and Schroders Investment 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 Schroders Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CATLIN GROUP and Schroders Investment Trusts, you can compare the effects of market volatilities on CATLIN GROUP and Schroders Investment 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 Schroders Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of CATLIN GROUP and Schroders Investment.
Diversification Opportunities for CATLIN GROUP and Schroders Investment
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CATLIN and Schroders is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding CATLIN GROUP and Schroders Investment Trusts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schroders Investment 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 Schroders Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schroders Investment has no effect on the direction of CATLIN GROUP i.e., CATLIN GROUP and Schroders Investment go up and down completely randomly.
Pair Corralation between CATLIN GROUP and Schroders Investment
Assuming the 90 days trading horizon CATLIN GROUP is expected to generate 1.57 times more return on investment than Schroders Investment. However, CATLIN GROUP is 1.57 times more volatile than Schroders Investment Trusts. It trades about 0.05 of its potential returns per unit of risk. Schroders Investment Trusts is currently generating about 0.04 per unit of risk. If you would invest 6,900 in CATLIN GROUP on September 13, 2024 and sell it today you would earn a total of 2,500 from holding CATLIN GROUP or generate 36.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
CATLIN GROUP vs. Schroders Investment Trusts
Performance |
| Timeline |
| CATLIN GROUP |
| Schroders Investment |
CATLIN GROUP and Schroders Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CATLIN GROUP and Schroders Investment
The main advantage of trading using opposite CATLIN GROUP and Schroders Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CATLIN GROUP position performs unexpectedly, Schroders Investment 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 Schroders Investment will offset losses from the drop in Schroders Investment's long position.| CATLIN GROUP vs. Pfeiffer Vacuum Technology | CATLIN GROUP vs. Hilton Food Group | CATLIN GROUP vs. Sabien Technology Group | CATLIN GROUP vs. Spotify Technology SA |
| Schroders Investment vs. Catalyst Media Group | Schroders Investment vs. CATLIN GROUP | Schroders Investment vs. Tamburi Investment Partners | Schroders Investment vs. Magnora ASA |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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