Correlation Between CSG Systems and Katapult Holdings
Can any of the company-specific risk be diversified away by investing in both CSG Systems and Katapult Holdings 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 CSG Systems and Katapult Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CSG Systems International and Katapult Holdings, you can compare the effects of market volatilities on CSG Systems and Katapult Holdings 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 CSG Systems with a short position of Katapult Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of CSG Systems and Katapult Holdings.
Diversification Opportunities for CSG Systems and Katapult Holdings
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CSG and Katapult is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding CSG Systems International and Katapult Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Katapult Holdings and CSG Systems 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 CSG Systems International are associated (or correlated) with Katapult Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Katapult Holdings has no effect on the direction of CSG Systems i.e., CSG Systems and Katapult Holdings go up and down completely randomly.
Pair Corralation between CSG Systems and Katapult Holdings
Given the investment horizon of 90 days CSG Systems International is expected to under-perform the Katapult Holdings. But the stock apears to be less risky and, when comparing its historical volatility, CSG Systems International is 5.48 times less risky than Katapult Holdings. The stock trades about -0.06 of its potential returns per unit of risk. The Katapult Holdings is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 647.00 in Katapult Holdings on September 15, 2024 and sell it today you would earn a total of 2.00 from holding Katapult Holdings or generate 0.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CSG Systems International vs. Katapult Holdings
Performance |
| Timeline |
| CSG Systems International |
| Katapult Holdings |
CSG Systems and Katapult Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CSG Systems and Katapult Holdings
The main advantage of trading using opposite CSG Systems and Katapult Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CSG Systems position performs unexpectedly, Katapult Holdings 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 Katapult Holdings will offset losses from the drop in Katapult Holdings' long position.| CSG Systems vs. Oneconnect Financial Technology | CSG Systems vs. Global Business Travel | CSG Systems vs. Alight Inc | CSG Systems vs. CS Disco LLC |
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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 Directory module to find actively traded commodities issued by global exchanges.
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