Correlation Between Catena Media and Cinis Fertilizer
Can any of the company-specific risk be diversified away by investing in both Catena Media and Cinis Fertilizer 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 Catena Media and Cinis Fertilizer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Catena Media plc and Cinis Fertilizer AB, you can compare the effects of market volatilities on Catena Media and Cinis Fertilizer 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 Catena Media with a short position of Cinis Fertilizer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catena Media and Cinis Fertilizer.
Diversification Opportunities for Catena Media and Cinis Fertilizer
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Catena and Cinis is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Catena Media plc and Cinis Fertilizer AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cinis Fertilizer and Catena 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 Catena Media plc are associated (or correlated) with Cinis Fertilizer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cinis Fertilizer has no effect on the direction of Catena Media i.e., Catena Media and Cinis Fertilizer go up and down completely randomly.
Pair Corralation between Catena Media and Cinis Fertilizer
Assuming the 90 days trading horizon Catena Media plc is expected to under-perform the Cinis Fertilizer. In addition to that, Catena Media is 1.15 times more volatile than Cinis Fertilizer AB. It trades about -0.09 of its total potential returns per unit of risk. Cinis Fertilizer AB is currently generating about -0.05 per unit of volatility. If you would invest 4,235 in Cinis Fertilizer AB on August 29, 2024 and sell it today you would lose (2,651) from holding Cinis Fertilizer AB or give up 62.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Catena Media plc vs. Cinis Fertilizer AB
Performance |
| Timeline |
| Catena Media plc |
| Cinis Fertilizer |
Catena Media and Cinis Fertilizer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catena Media and Cinis Fertilizer
The main advantage of trading using opposite Catena Media and Cinis Fertilizer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catena Media position performs unexpectedly, Cinis Fertilizer 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 Cinis Fertilizer will offset losses from the drop in Cinis Fertilizer's long position.| Catena Media vs. Betsson AB | Catena Media vs. Kambi Group PLC | Catena Media vs. Better Collective | Catena Media vs. Evolution AB |
| Cinis Fertilizer vs. Qleanair Holding AB | Cinis Fertilizer vs. Invisio Communications AB | Cinis Fertilizer vs. Arion banki hf | Cinis Fertilizer vs. SaveLend Group AB |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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