Correlation Between Catalyst/smh High and Fisher Investments
Can any of the company-specific risk be diversified away by investing in both Catalyst/smh High and Fisher Investments 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/smh High and Fisher Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Catalystsmh High Income and Fisher Large Cap, you can compare the effects of market volatilities on Catalyst/smh High and Fisher Investments 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/smh High with a short position of Fisher Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catalyst/smh High and Fisher Investments.
Diversification Opportunities for Catalyst/smh High and Fisher Investments
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Catalyst/smh and Fisher is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Catalystsmh High Income and Fisher Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fisher Investments and Catalyst/smh High 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 Catalystsmh High Income are associated (or correlated) with Fisher Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fisher Investments has no effect on the direction of Catalyst/smh High i.e., Catalyst/smh High and Fisher Investments go up and down completely randomly.
Pair Corralation between Catalyst/smh High and Fisher Investments
Assuming the 90 days horizon Catalystsmh High Income is expected to generate 0.35 times more return on investment than Fisher Investments. However, Catalystsmh High Income is 2.89 times less risky than Fisher Investments. It trades about -0.24 of its potential returns per unit of risk. Fisher Large Cap is currently generating about -0.26 per unit of risk. If you would invest 377.00 in Catalystsmh High Income on October 11, 2024 and sell it today you would lose (6.00) from holding Catalystsmh High Income or give up 1.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.24% |
| Values | Daily Returns |
Catalystsmh High Income vs. Fisher Large Cap
Performance |
| Timeline |
| Catalystsmh High Income |
| Fisher Investments |
Catalyst/smh High and Fisher Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catalyst/smh High and Fisher Investments
The main advantage of trading using opposite Catalyst/smh High and Fisher Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catalyst/smh High position performs unexpectedly, Fisher Investments 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 Fisher Investments will offset losses from the drop in Fisher Investments' long position.| Catalyst/smh High vs. Americafirst Large Cap | Catalyst/smh High vs. M Large Cap | Catalyst/smh High vs. Fisher Large Cap | Catalyst/smh High vs. Avantis Large Cap |
| Fisher Investments vs. Ab High Income | Fisher Investments vs. Ab High Income | Fisher Investments vs. Catalystsmh High Income | Fisher Investments vs. Siit High Yield |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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