Correlation Between Catalyst Media and T Mobile
Can any of the company-specific risk be diversified away by investing in both Catalyst Media and T Mobile 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 T Mobile 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 T Mobile, you can compare the effects of market volatilities on Catalyst Media and T Mobile 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 T Mobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catalyst Media and T Mobile.
Diversification Opportunities for Catalyst Media and T Mobile
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Catalyst and 0R2L is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Catalyst Media Group and T Mobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on T Mobile 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 T Mobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of T Mobile has no effect on the direction of Catalyst Media i.e., Catalyst Media and T Mobile go up and down completely randomly.
Pair Corralation between Catalyst Media and T Mobile
Assuming the 90 days trading horizon Catalyst Media is expected to generate 42.4 times less return on investment than T Mobile. But when comparing it to its historical volatility, Catalyst Media Group is 24.8 times less risky than T Mobile. It trades about 0.06 of its potential returns per unit of risk. T Mobile is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 19,953 in T Mobile on September 3, 2024 and sell it today you would earn a total of 4,741 from holding T Mobile or generate 23.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.46% |
| Values | Daily Returns |
Catalyst Media Group vs. T Mobile
Performance |
| Timeline |
| Catalyst Media Group |
| T Mobile |
Catalyst Media and T Mobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catalyst Media and T Mobile
The main advantage of trading using opposite Catalyst Media and T Mobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catalyst Media position performs unexpectedly, T Mobile 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 T Mobile will offset losses from the drop in T Mobile's long position.| Catalyst Media vs. Smithson Investment Trust | Catalyst Media vs. Kinnevik Investment AB | Catalyst Media vs. New Residential Investment | Catalyst Media vs. The Mercantile Investment |
| T Mobile vs. Catalyst Media Group | T Mobile vs. CATLIN GROUP | T Mobile vs. Magnora ASA | T Mobile 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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