Correlation Between Catalyst Media and United Airlines
Can any of the company-specific risk be diversified away by investing in both Catalyst Media and United Airlines 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 United Airlines 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 United Airlines Holdings, you can compare the effects of market volatilities on Catalyst Media and United Airlines 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 United Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catalyst Media and United Airlines.
Diversification Opportunities for Catalyst Media and United Airlines
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Catalyst and United is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Catalyst Media Group and United Airlines Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Airlines Holdings 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 United Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Airlines Holdings has no effect on the direction of Catalyst Media i.e., Catalyst Media and United Airlines go up and down completely randomly.
Pair Corralation between Catalyst Media and United Airlines
Assuming the 90 days trading horizon Catalyst Media Group is expected to under-perform the United Airlines. But the stock apears to be less risky and, when comparing its historical volatility, Catalyst Media Group is 1.47 times less risky than United Airlines. The stock trades about -0.03 of its potential returns per unit of risk. The United Airlines Holdings is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 5,124 in United Airlines Holdings on September 4, 2024 and sell it today you would earn a total of 4,644 from holding United Airlines Holdings or generate 90.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.69% |
| Values | Daily Returns |
Catalyst Media Group vs. United Airlines Holdings
Performance |
| Timeline |
| Catalyst Media Group |
| United Airlines Holdings |
Catalyst Media and United Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catalyst Media and United Airlines
The main advantage of trading using opposite Catalyst Media and United Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catalyst Media position performs unexpectedly, United Airlines 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 United Airlines will offset losses from the drop in United Airlines' long position.| Catalyst Media vs. STMicroelectronics NV | Catalyst Media vs. TR Property Investment | Catalyst Media vs. Monks Investment Trust | Catalyst Media vs. Smithson Investment Trust |
| United Airlines vs. Cairo Communication SpA | United Airlines vs. Silvercorp Metals | United Airlines vs. Axway Software SA | United Airlines vs. Endeavour Mining Corp |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |