Correlation Between Catalyst Media and Aberforth Smaller
Can any of the company-specific risk be diversified away by investing in both Catalyst Media and Aberforth Smaller 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 Aberforth Smaller 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 Aberforth Smaller Companies, you can compare the effects of market volatilities on Catalyst Media and Aberforth Smaller 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 Aberforth Smaller. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catalyst Media and Aberforth Smaller.
Diversification Opportunities for Catalyst Media and Aberforth Smaller
-0.87 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Catalyst and Aberforth is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Catalyst Media Group and Aberforth Smaller Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberforth Smaller 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 Aberforth Smaller. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberforth Smaller has no effect on the direction of Catalyst Media i.e., Catalyst Media and Aberforth Smaller go up and down completely randomly.
Pair Corralation between Catalyst Media and Aberforth Smaller
Assuming the 90 days trading horizon Catalyst Media is expected to generate 2.8 times less return on investment than Aberforth Smaller. In addition to that, Catalyst Media is 1.79 times more volatile than Aberforth Smaller Companies. It trades about 0.01 of its total potential returns per unit of risk. Aberforth Smaller Companies is currently generating about 0.04 per unit of volatility. If you would invest 120,897 in Aberforth Smaller Companies on August 27, 2024 and sell it today you would earn a total of 23,303 from holding Aberforth Smaller Companies or generate 19.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Catalyst Media Group vs. Aberforth Smaller Companies
Performance |
| Timeline |
| Catalyst Media Group |
| Aberforth Smaller |
Catalyst Media and Aberforth Smaller Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catalyst Media and Aberforth Smaller
The main advantage of trading using opposite Catalyst Media and Aberforth Smaller positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catalyst Media position performs unexpectedly, Aberforth Smaller 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 Aberforth Smaller will offset losses from the drop in Aberforth Smaller's long position.| Catalyst Media vs. Toyota Motor Corp | Catalyst Media vs. SoftBank Group Corp | Catalyst Media vs. Fannie Mae | Catalyst Media vs. State Bank of |
| Aberforth Smaller vs. Federal Realty Investment | Aberforth Smaller vs. Aberdeen Diversified Income | Aberforth Smaller vs. Induction Healthcare Group | Aberforth Smaller vs. New Residential Investment |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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