Correlation Between Catalyst Media and Fannie Mae
Can any of the company-specific risk be diversified away by investing in both Catalyst Media and Fannie Mae 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 Media and Fannie Mae into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Catalyst Media Group and Fannie Mae, you can compare the effects of market volatilities on Catalyst Media and Fannie Mae 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 Media with a short position of Fannie Mae. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catalyst Media and Fannie Mae.
Diversification Opportunities for Catalyst Media and Fannie Mae
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Catalyst and Fannie is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Catalyst Media Group and Fannie Mae in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fannie Mae and Catalyst Media 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 Media Group are associated (or correlated) with Fannie Mae. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fannie Mae has no effect on the direction of Catalyst Media i.e., Catalyst Media and Fannie Mae go up and down completely randomly.
Pair Corralation between Catalyst Media and Fannie Mae
Assuming the 90 days trading horizon Catalyst Media Group is expected to under-perform the Fannie Mae. But the stock apears to be less risky and, when comparing its historical volatility, Catalyst Media Group is 5.62 times less risky than Fannie Mae. The stock trades about -0.4 of its potential returns per unit of risk. The Fannie Mae is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 270.00 in Fannie Mae on October 12, 2024 and sell it today you would earn a total of 208.00 from holding Fannie Mae or generate 77.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Catalyst Media Group vs. Fannie Mae
Performance |
| Timeline |
| Catalyst Media Group |
| Fannie Mae |
Catalyst Media and Fannie Mae Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catalyst Media and Fannie Mae
The main advantage of trading using opposite Catalyst Media and Fannie Mae positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catalyst Media position performs unexpectedly, Fannie Mae 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 Fannie Mae will offset losses from the drop in Fannie Mae's long position.| Catalyst Media vs. Gear4music Plc | Catalyst Media vs. Arrow Electronics | Catalyst Media vs. STMicroelectronics NV | Catalyst Media vs. Electronic Arts |
| Fannie Mae vs. Catalyst Media Group | Fannie Mae vs. Centaur Media | Fannie Mae vs. Pets at Home | Fannie Mae vs. Ecclesiastical Insurance Office |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Commodity Directory Find actively traded commodities issued by global exchanges |