Correlation Between Catalyst/smh High and Lsv Global
Can any of the company-specific risk be diversified away by investing in both Catalyst/smh High and Lsv Global 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 Lsv Global 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 Lsv Global Managed, you can compare the effects of market volatilities on Catalyst/smh High and Lsv Global 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 Lsv Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catalyst/smh High and Lsv Global.
Diversification Opportunities for Catalyst/smh High and Lsv Global
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Catalyst/smh and Lsv is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Catalystsmh High Income and Lsv Global Managed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lsv Global Managed 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 Lsv Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lsv Global Managed has no effect on the direction of Catalyst/smh High i.e., Catalyst/smh High and Lsv Global go up and down completely randomly.
Pair Corralation between Catalyst/smh High and Lsv Global
Assuming the 90 days horizon Catalystsmh High Income is expected to generate 0.12 times more return on investment than Lsv Global. However, Catalystsmh High Income is 8.11 times less risky than Lsv Global. It trades about -0.26 of its potential returns per unit of risk. Lsv Global Managed is currently generating about -0.35 per unit of risk. If you would invest 377.00 in Catalystsmh High Income on October 9, 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 | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Catalystsmh High Income vs. Lsv Global Managed
Performance |
| Timeline |
| Catalystsmh High Income |
| Lsv Global Managed |
Catalyst/smh High and Lsv Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catalyst/smh High and Lsv Global
The main advantage of trading using opposite Catalyst/smh High and Lsv Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catalyst/smh High position performs unexpectedly, Lsv Global 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 Lsv Global will offset losses from the drop in Lsv Global's long position.| Catalyst/smh High vs. Ab Small Cap | Catalyst/smh High vs. Tax Managed Large Cap | Catalyst/smh High vs. Rationalpier 88 Convertible | Catalyst/smh High vs. Issachar Fund Class |
| Lsv Global vs. Lsv Global Value | Lsv Global vs. Lsv Value Equity | Lsv Global vs. Lsv Managed Volatility | Lsv Global vs. Lsv Small Cap |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |