Correlation Between Catalyst Media and Tatton Asset
Can any of the company-specific risk be diversified away by investing in both Catalyst Media and Tatton Asset 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 Tatton Asset 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 Tatton Asset Management, you can compare the effects of market volatilities on Catalyst Media and Tatton Asset 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 Tatton Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catalyst Media and Tatton Asset.
Diversification Opportunities for Catalyst Media and Tatton Asset
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Catalyst and Tatton is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Catalyst Media Group and Tatton Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tatton Asset Management 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 Tatton Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tatton Asset Management has no effect on the direction of Catalyst Media i.e., Catalyst Media and Tatton Asset go up and down completely randomly.
Pair Corralation between Catalyst Media and Tatton Asset
Assuming the 90 days trading horizon Catalyst Media Group is expected to under-perform the Tatton Asset. In addition to that, Catalyst Media is 2.13 times more volatile than Tatton Asset Management. It trades about -0.07 of its total potential returns per unit of risk. Tatton Asset Management is currently generating about 0.07 per unit of volatility. If you would invest 69,053 in Tatton Asset Management on August 29, 2024 and sell it today you would earn a total of 1,347 from holding Tatton Asset Management or generate 1.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Catalyst Media Group vs. Tatton Asset Management
Performance |
| Timeline |
| Catalyst Media Group |
| Tatton Asset Management |
Catalyst Media and Tatton Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catalyst Media and Tatton Asset
The main advantage of trading using opposite Catalyst Media and Tatton Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catalyst Media position performs unexpectedly, Tatton Asset 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 Tatton Asset will offset losses from the drop in Tatton Asset's long position.| Catalyst Media vs. Universal Music Group | Catalyst Media vs. Ecclesiastical Insurance Office | Catalyst Media vs. X FAB Silicon Foundries | Catalyst Media vs. Polar Capital Technology |
| Tatton Asset vs. Iron Mountain | Tatton Asset vs. Gamma Communications PLC | Tatton Asset vs. Foresight Environmental Infrastructure | Tatton Asset vs. Evolution Gaming Group |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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