Correlation Between NETGEAR and Catalyst Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both NETGEAR 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 NETGEAR and Catalyst Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NETGEAR and Catalyst Pharmaceuticals, you can compare the effects of market volatilities on NETGEAR 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 NETGEAR with a short position of Catalyst Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of NETGEAR and Catalyst Pharmaceuticals.
Diversification Opportunities for NETGEAR and Catalyst Pharmaceuticals
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NETGEAR and Catalyst is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding NETGEAR and Catalyst Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalyst Pharmaceuticals and NETGEAR 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 NETGEAR 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 NETGEAR i.e., NETGEAR and Catalyst Pharmaceuticals go up and down completely randomly.
Pair Corralation between NETGEAR and Catalyst Pharmaceuticals
Given the investment horizon of 90 days NETGEAR is expected to generate 0.95 times more return on investment than Catalyst Pharmaceuticals. However, NETGEAR is 1.05 times less risky than Catalyst Pharmaceuticals. It trades about 0.32 of its potential returns per unit of risk. Catalyst Pharmaceuticals is currently generating about 0.08 per unit of risk. If you would invest 2,068 in NETGEAR on August 31, 2024 and sell it today you would earn a total of 336.00 from holding NETGEAR or generate 16.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NETGEAR vs. Catalyst Pharmaceuticals
Performance |
| Timeline |
| NETGEAR |
| Catalyst Pharmaceuticals |
NETGEAR and Catalyst Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NETGEAR and Catalyst Pharmaceuticals
The main advantage of trading using opposite NETGEAR and Catalyst Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NETGEAR 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.| NETGEAR vs. KVH Industries | NETGEAR vs. Ituran Location and | NETGEAR vs. Aviat Networks | NETGEAR vs. Mynaric AG ADR |
| Catalyst Pharmaceuticals vs. Cue Biopharma | Catalyst Pharmaceuticals vs. Tff Pharmaceuticals | Catalyst Pharmaceuticals vs. Eliem Therapeutics | Catalyst Pharmaceuticals vs. Inhibrx |
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
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |