Correlation Between Katapult Holdings and SOS
Can any of the company-specific risk be diversified away by investing in both Katapult Holdings and SOS 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 Katapult Holdings and SOS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Katapult Holdings and SOS Limited, you can compare the effects of market volatilities on Katapult Holdings and SOS 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 Katapult Holdings with a short position of SOS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Katapult Holdings and SOS.
Diversification Opportunities for Katapult Holdings and SOS
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Katapult and SOS is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Katapult Holdings and SOS Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SOS Limited and Katapult Holdings 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 Katapult Holdings are associated (or correlated) with SOS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SOS Limited has no effect on the direction of Katapult Holdings i.e., Katapult Holdings and SOS go up and down completely randomly.
Pair Corralation between Katapult Holdings and SOS
Given the investment horizon of 90 days Katapult Holdings is expected to under-perform the SOS. But the stock apears to be less risky and, when comparing its historical volatility, Katapult Holdings is 2.54 times less risky than SOS. The stock trades about -0.17 of its potential returns per unit of risk. The SOS Limited is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 1,380 in SOS Limited on August 30, 2024 and sell it today you would lose (387.00) from holding SOS Limited or give up 28.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Katapult Holdings vs. SOS Limited
Performance |
| Timeline |
| Katapult Holdings |
| SOS Limited |
Katapult Holdings and SOS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Katapult Holdings and SOS
The main advantage of trading using opposite Katapult Holdings and SOS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Katapult Holdings position performs unexpectedly, SOS 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 SOS will offset losses from the drop in SOS's long position.| Katapult Holdings vs. Evertec | Katapult Holdings vs. i3 Verticals | Katapult Holdings vs. Euronet Worldwide | Katapult Holdings vs. EverCommerce |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |