Correlation Between Cal Comp and Catcher Technology

Can any of the company-specific risk be diversified away by investing in both Cal Comp and Catcher Technology 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 Cal Comp and Catcher Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Cal Comp Electronics Public and Catcher Technology Co, you can compare the effects of market volatilities on Cal Comp and Catcher Technology 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 Cal Comp with a short position of Catcher Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cal Comp and Catcher Technology.

Diversification Opportunities for Cal Comp and Catcher Technology

-0.57

Correlation Coefficient

Cal Comp  Catcher Technology

Excellent diversification

The 3 months correlation between Cal and Catcher is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Cal Comp Electronics Public and Catcher Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catcher Technology and Cal Comp 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 Cal Comp Electronics Public are associated (or correlated) with Catcher Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catcher Technology has no effect on the direction of Cal Comp i.e., Cal Comp and Catcher Technology go up and down completely randomly.

Pair Corralation between Cal Comp and Catcher Technology

Assuming the 90 days trading horizon Cal Comp Electronics Public is expected to under-perform the Catcher Technology. In addition to that, Cal Comp is 3.11 times more volatile than Catcher Technology Co. It trades about -0.14 of its total potential returns per unit of risk. Catcher Technology Co is currently generating about 0.26 per unit of volatility. If you would invest  19,150  in Catcher Technology Co on December 27, 2024 and sell it today you would earn a total of  2,100  from holding Catcher Technology Co or generate 10.97% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Cal Comp Electronics Public  vs.  Catcher Technology Co

Cal Comp Electronics

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cal Comp Electronics Public has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Catcher Technology

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Catcher Technology Co are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Catcher Technology may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Cal Comp and Catcher Technology

The main advantage of trading using opposite Cal Comp and Catcher Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cal Comp position performs unexpectedly, Catcher Technology 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 Catcher Technology will offset losses from the drop in Catcher Technology's long position.

The idea behind Cal Comp Electronics Public and Catcher Technology Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.