Correlation Between Catalyst Media and Lowland Investment
Can any of the company-specific risk be diversified away by investing in both Catalyst Media and Lowland 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 Lowland 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 Lowland Investment Co, you can compare the effects of market volatilities on Catalyst Media and Lowland 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 Lowland Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catalyst Media and Lowland Investment.
Diversification Opportunities for Catalyst Media and Lowland Investment
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Catalyst and Lowland is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Catalyst Media Group and Lowland Investment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lowland 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 Lowland Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lowland Investment has no effect on the direction of Catalyst Media i.e., Catalyst Media and Lowland Investment go up and down completely randomly.
Pair Corralation between Catalyst Media and Lowland Investment
Assuming the 90 days trading horizon Catalyst Media Group is expected to under-perform the Lowland Investment. In addition to that, Catalyst Media is 2.47 times more volatile than Lowland Investment Co. It trades about -0.08 of its total potential returns per unit of risk. Lowland Investment Co is currently generating about -0.04 per unit of volatility. If you would invest 12,650 in Lowland Investment Co on August 27, 2024 and sell it today you would lose (150.00) from holding Lowland Investment Co or give up 1.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Catalyst Media Group vs. Lowland Investment Co
Performance |
| Timeline |
| Catalyst Media Group |
| Lowland Investment |
Catalyst Media and Lowland Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catalyst Media and Lowland Investment
The main advantage of trading using opposite Catalyst Media and Lowland Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catalyst Media position performs unexpectedly, Lowland 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 Lowland Investment will offset losses from the drop in Lowland Investment'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 |
| Lowland Investment vs. Catalyst Media Group | Lowland Investment vs. Oncimmune Holdings plc | Lowland Investment vs. Invesco Health Care | Lowland 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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