Correlation Between Catalystmillburn and Catalyst Exceed
Can any of the company-specific risk be diversified away by investing in both Catalystmillburn and Catalyst Exceed 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 Catalystmillburn and Catalyst Exceed into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Catalystmillburn Hedge Strategy and Catalyst Exceed Defined, you can compare the effects of market volatilities on Catalystmillburn and Catalyst Exceed 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 Catalystmillburn with a short position of Catalyst Exceed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catalystmillburn and Catalyst Exceed.
Diversification Opportunities for Catalystmillburn and Catalyst Exceed
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Catalystmillburn and Catalyst is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Catalystmillburn Hedge Strateg and Catalyst Exceed Defined in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalyst Exceed Defined and Catalystmillburn 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 Catalystmillburn Hedge Strategy are associated (or correlated) with Catalyst Exceed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalyst Exceed Defined has no effect on the direction of Catalystmillburn i.e., Catalystmillburn and Catalyst Exceed go up and down completely randomly.
Pair Corralation between Catalystmillburn and Catalyst Exceed
Assuming the 90 days horizon Catalystmillburn Hedge Strategy is expected to generate 0.72 times more return on investment than Catalyst Exceed. However, Catalystmillburn Hedge Strategy is 1.38 times less risky than Catalyst Exceed. It trades about 0.28 of its potential returns per unit of risk. Catalyst Exceed Defined is currently generating about 0.15 per unit of risk. If you would invest 3,865 in Catalystmillburn Hedge Strategy on September 1, 2024 and sell it today you would earn a total of 134.00 from holding Catalystmillburn Hedge Strategy or generate 3.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Catalystmillburn Hedge Strateg vs. Catalyst Exceed Defined
Performance |
| Timeline |
| Catalystmillburn Hedge |
| Catalyst Exceed Defined |
Catalystmillburn and Catalyst Exceed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catalystmillburn and Catalyst Exceed
The main advantage of trading using opposite Catalystmillburn and Catalyst Exceed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catalystmillburn position performs unexpectedly, Catalyst Exceed 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 Exceed will offset losses from the drop in Catalyst Exceed's long position.| Catalystmillburn vs. International Investors Gold | Catalystmillburn vs. Franklin Gold Precious | Catalystmillburn vs. James Balanced Golden | Catalystmillburn vs. Great West Goldman Sachs |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |