Correlation Between Catalyst Insider and Templeton Emerging
Can any of the company-specific risk be diversified away by investing in both Catalyst Insider and Templeton Emerging 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 Insider and Templeton Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Catalyst Insider Income and Templeton Emerging Markets, you can compare the effects of market volatilities on Catalyst Insider and Templeton Emerging 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 Insider with a short position of Templeton Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catalyst Insider and Templeton Emerging.
Diversification Opportunities for Catalyst Insider and Templeton Emerging
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Catalyst and Templeton is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Catalyst Insider Income and Templeton Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Templeton Emerging and Catalyst Insider 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 Insider Income are associated (or correlated) with Templeton Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Templeton Emerging has no effect on the direction of Catalyst Insider i.e., Catalyst Insider and Templeton Emerging go up and down completely randomly.
Pair Corralation between Catalyst Insider and Templeton Emerging
Assuming the 90 days horizon Catalyst Insider is expected to generate 2.06 times less return on investment than Templeton Emerging. But when comparing it to its historical volatility, Catalyst Insider Income is 4.65 times less risky than Templeton Emerging. It trades about 0.26 of its potential returns per unit of risk. Templeton Emerging Markets is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 513.00 in Templeton Emerging Markets on October 20, 2024 and sell it today you would earn a total of 9.00 from holding Templeton Emerging Markets or generate 1.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Catalyst Insider Income vs. Templeton Emerging Markets
Performance |
| Timeline |
| Catalyst Insider Income |
| Templeton Emerging |
Catalyst Insider and Templeton Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catalyst Insider and Templeton Emerging
The main advantage of trading using opposite Catalyst Insider and Templeton Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catalyst Insider position performs unexpectedly, Templeton Emerging 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 Templeton Emerging will offset losses from the drop in Templeton Emerging's long position.| Catalyst Insider vs. Catalystsmh High Income | Catalyst Insider vs. Catalystsmh High Income | Catalyst Insider vs. Catalystsmh High Income | Catalyst Insider vs. Catalyst Mlp Infrastructure |
| Templeton Emerging vs. Franklin Templeton Limited | Templeton Emerging vs. Western Asset Global | Templeton Emerging vs. MFS Multimarket Income | Templeton Emerging vs. Aberdeen Asia Pacific If |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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