Correlation Between Catalyst Media and Schroders Investment
Can any of the company-specific risk be diversified away by investing in both Catalyst Media 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 Catalyst Media and Schroders Investment 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 Schroders Investment Trusts, you can compare the effects of market volatilities on Catalyst Media 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 Catalyst Media with a short position of Schroders Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catalyst Media and Schroders Investment.
Diversification Opportunities for Catalyst Media and Schroders Investment
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Catalyst and Schroders is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Catalyst Media 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 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 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 Catalyst Media i.e., Catalyst Media and Schroders Investment go up and down completely randomly.
Pair Corralation between Catalyst Media and Schroders Investment
Assuming the 90 days trading horizon Catalyst Media is expected to generate 54.63 times less return on investment than Schroders Investment. In addition to that, Catalyst Media is 1.71 times more volatile than Schroders Investment Trusts. It trades about 0.0 of its total potential returns per unit of risk. Schroders Investment Trusts is currently generating about 0.04 per unit of volatility. If you would invest 39,312 in Schroders Investment Trusts on August 30, 2024 and sell it today you would earn a total of 8,288 from holding Schroders Investment Trusts or generate 21.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Catalyst Media Group vs. Schroders Investment Trusts
Performance |
| Timeline |
| Catalyst Media Group |
| Schroders Investment |
Catalyst Media and Schroders Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catalyst Media and Schroders Investment
The main advantage of trading using opposite Catalyst Media and Schroders Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catalyst Media 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.| Catalyst Media vs. Walmart | Catalyst Media vs. BYD Co | Catalyst Media vs. Volkswagen AG | Catalyst Media vs. Volkswagen AG Non Vtg |
| Schroders Investment vs. Toyota Motor Corp | Schroders Investment vs. Lendinvest PLC | Schroders Investment vs. Neometals | Schroders Investment vs. Coor Service Management |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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