Correlation Between KWG Group and Catalyst Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both KWG Group and Catalyst Pharmaceuticals 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 KWG Group and Catalyst Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KWG Group Holdings and Catalyst Pharmaceuticals, you can compare the effects of market volatilities on KWG Group and Catalyst Pharmaceuticals 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 KWG Group with a short position of Catalyst Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of KWG Group and Catalyst Pharmaceuticals.
Diversification Opportunities for KWG Group and Catalyst Pharmaceuticals
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between KWG and Catalyst is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding KWG Group Holdings and Catalyst Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalyst Pharmaceuticals and KWG Group 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 KWG Group Holdings are associated (or correlated) with Catalyst Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalyst Pharmaceuticals has no effect on the direction of KWG Group i.e., KWG Group and Catalyst Pharmaceuticals go up and down completely randomly.
Pair Corralation between KWG Group and Catalyst Pharmaceuticals
If you would invest 1,500 in Catalyst Pharmaceuticals on September 14, 2024 and sell it today you would earn a total of 634.00 from holding Catalyst Pharmaceuticals or generate 42.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
KWG Group Holdings vs. Catalyst Pharmaceuticals
Performance |
| Timeline |
| KWG Group Holdings |
| Catalyst Pharmaceuticals |
KWG Group and Catalyst Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KWG Group and Catalyst Pharmaceuticals
The main advantage of trading using opposite KWG Group and Catalyst Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KWG Group position performs unexpectedly, Catalyst Pharmaceuticals 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 Pharmaceuticals will offset losses from the drop in Catalyst Pharmaceuticals' long position.| KWG Group vs. BBB Foods | KWG Group vs. Gentex | KWG Group vs. Magna International | KWG Group vs. Where Food Comes |
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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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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