Correlation Between Impax Asset and Catalyst Media
Can any of the company-specific risk be diversified away by investing in both Impax Asset and Catalyst Media 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 Impax Asset and Catalyst Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Impax Asset Management and Catalyst Media Group, you can compare the effects of market volatilities on Impax Asset and Catalyst Media 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 Impax Asset with a short position of Catalyst Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Impax Asset and Catalyst Media.
Diversification Opportunities for Impax Asset and Catalyst Media
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Impax and Catalyst is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Impax Asset Management and Catalyst Media Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalyst Media Group and Impax Asset 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 Impax Asset Management are associated (or correlated) with Catalyst Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalyst Media Group has no effect on the direction of Impax Asset i.e., Impax Asset and Catalyst Media go up and down completely randomly.
Pair Corralation between Impax Asset and Catalyst Media
Assuming the 90 days trading horizon Impax Asset Management is expected to generate 0.86 times more return on investment than Catalyst Media. However, Impax Asset Management is 1.16 times less risky than Catalyst Media. It trades about -0.09 of its potential returns per unit of risk. Catalyst Media Group is currently generating about -0.17 per unit of risk. If you would invest 35,100 in Impax Asset Management on September 1, 2024 and sell it today you would lose (1,750) from holding Impax Asset Management or give up 4.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Impax Asset Management vs. Catalyst Media Group
Performance |
| Timeline |
| Impax Asset Management |
| Catalyst Media Group |
Impax Asset and Catalyst Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Impax Asset and Catalyst Media
The main advantage of trading using opposite Impax Asset and Catalyst Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Impax Asset position performs unexpectedly, Catalyst Media 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 Catalyst Media will offset losses from the drop in Catalyst Media's long position.| Impax Asset vs. Toyota Motor Corp | Impax Asset vs. SoftBank Group Corp | Impax Asset vs. OTP Bank Nyrt | Impax Asset vs. Las Vegas Sands |
| Catalyst Media vs. Samsung Electronics Co | Catalyst Media vs. Samsung Electronics Co | Catalyst Media vs. Hyundai Motor | Catalyst Media vs. Toyota Motor Corp |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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