Correlation Between Catalyst Media and Allianz Technology
Can any of the company-specific risk be diversified away by investing in both Catalyst Media and Allianz Technology 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 Allianz Technology 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 Allianz Technology Trust, you can compare the effects of market volatilities on Catalyst Media and Allianz Technology 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 Allianz Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catalyst Media and Allianz Technology.
Diversification Opportunities for Catalyst Media and Allianz Technology
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Catalyst and Allianz is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Catalyst Media Group and Allianz Technology Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianz Technology Trust 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 Allianz Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianz Technology Trust has no effect on the direction of Catalyst Media i.e., Catalyst Media and Allianz Technology go up and down completely randomly.
Pair Corralation between Catalyst Media and Allianz Technology
Assuming the 90 days trading horizon Catalyst Media is expected to generate 2.4 times less return on investment than Allianz Technology. In addition to that, Catalyst Media is 1.5 times more volatile than Allianz Technology Trust. It trades about 0.04 of its total potential returns per unit of risk. Allianz Technology Trust is currently generating about 0.15 per unit of volatility. If you would invest 37,900 in Allianz Technology Trust on August 26, 2024 and sell it today you would earn a total of 1,900 from holding Allianz Technology Trust or generate 5.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Catalyst Media Group vs. Allianz Technology Trust
Performance |
| Timeline |
| Catalyst Media Group |
| Allianz Technology Trust |
Catalyst Media and Allianz Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catalyst Media and Allianz Technology
The main advantage of trading using opposite Catalyst Media and Allianz Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catalyst Media position performs unexpectedly, Allianz Technology 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 Allianz Technology will offset losses from the drop in Allianz Technology's long position.| Catalyst Media vs. Toyota Motor Corp | Catalyst Media vs. SoftBank Group Corp | Catalyst Media vs. Fannie Mae | Catalyst Media vs. Panasonic Corp |
| Allianz Technology vs. Catalyst Media Group | Allianz Technology vs. Oncimmune Holdings plc | Allianz Technology vs. Invesco Health Care | Allianz Technology 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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