Correlation Between Comstock Holding and Catalyst Pharmaceuticals

Can any of the company-specific risk be diversified away by investing in both Comstock Holding 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 Comstock Holding and Catalyst Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Comstock Holding Companies and Catalyst Pharmaceuticals, you can compare the effects of market volatilities on Comstock Holding 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 Comstock Holding with a short position of Catalyst Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Comstock Holding and Catalyst Pharmaceuticals.

Diversification Opportunities for Comstock Holding and Catalyst Pharmaceuticals

-0.08

Correlation Coefficient

Comstock Holding  Catalyst Pharmaceuticals

Good diversification

The 3 months correlation between Comstock and Catalyst is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Comstock Holding Companies and Catalyst Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalyst Pharmaceuticals and Comstock Holding 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 Comstock Holding Companies 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 Comstock Holding i.e., Comstock Holding and Catalyst Pharmaceuticals go up and down completely randomly.

Pair Corralation between Comstock Holding and Catalyst Pharmaceuticals

Given the investment horizon of 90 days Comstock Holding Companies is expected to generate 1.49 times more return on investment than Catalyst Pharmaceuticals. However, Comstock Holding is 1.49 times more volatile than Catalyst Pharmaceuticals. It trades about 0.08 of its potential returns per unit of risk. Catalyst Pharmaceuticals is currently generating about 0.08 per unit of risk. If you would invest  430.00  in Comstock Holding Companies on September 14, 2024 and sell it today you would earn a total of  410.00  from holding Comstock Holding Companies or generate 95.35% return on investment over 90 days.

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

Comstock Holding Companies  vs.  Catalyst Pharmaceuticals

Comstock Holding Com

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Comstock Holding Companies are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong fundamental indicators, Comstock Holding is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Catalyst Pharmaceuticals

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Catalyst Pharmaceuticals are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Catalyst Pharmaceuticals is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Comstock Holding and Catalyst Pharmaceuticals

The main advantage of trading using opposite Comstock Holding and Catalyst Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Comstock Holding 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.

The idea behind Comstock Holding Companies and Catalyst Pharmaceuticals 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.