Correlation Between Zanaga Iron and Catalyst Media
Can any of the company-specific risk be diversified away by investing in both Zanaga Iron 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 Zanaga Iron and Catalyst Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zanaga Iron Ore and Catalyst Media Group, you can compare the effects of market volatilities on Zanaga Iron 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 Zanaga Iron with a short position of Catalyst Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zanaga Iron and Catalyst Media.
Diversification Opportunities for Zanaga Iron and Catalyst Media
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Zanaga and Catalyst is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Zanaga Iron Ore 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 Zanaga Iron 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 Zanaga Iron Ore 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 Zanaga Iron i.e., Zanaga Iron and Catalyst Media go up and down completely randomly.
Pair Corralation between Zanaga Iron and Catalyst Media
Assuming the 90 days trading horizon Zanaga Iron Ore is expected to generate 3.77 times more return on investment than Catalyst Media. However, Zanaga Iron is 3.77 times more volatile than Catalyst Media Group. It trades about 0.16 of its potential returns per unit of risk. Catalyst Media Group is currently generating about -0.05 per unit of risk. If you would invest 448.00 in Zanaga Iron Ore on September 13, 2024 and sell it today you would earn a total of 226.00 from holding Zanaga Iron Ore or generate 50.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zanaga Iron Ore vs. Catalyst Media Group
Performance |
| Timeline |
| Zanaga Iron Ore |
| Catalyst Media Group |
Zanaga Iron and Catalyst Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zanaga Iron and Catalyst Media
The main advantage of trading using opposite Zanaga Iron and Catalyst Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zanaga Iron 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.| Zanaga Iron vs. Givaudan SA | Zanaga Iron vs. Antofagasta PLC | Zanaga Iron vs. Ferrexpo PLC | Zanaga Iron vs. Atalaya Mining |
| Catalyst Media vs. Zanaga Iron Ore | Catalyst Media vs. Alior Bank SA | Catalyst Media vs. Symphony Environmental Technologies | Catalyst Media vs. Ironveld Plc |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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