Correlation Between Catalyst Media and Biome Technologies
Can any of the company-specific risk be diversified away by investing in both Catalyst Media and Biome Technologies 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 Catalyst Media and Biome Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Catalyst Media Group and Biome Technologies Plc, you can compare the effects of market volatilities on Catalyst Media and Biome Technologies 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 Catalyst Media with a short position of Biome Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catalyst Media and Biome Technologies.
Diversification Opportunities for Catalyst Media and Biome Technologies
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Catalyst and Biome is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Catalyst Media Group and Biome Technologies Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biome Technologies Plc and Catalyst Media 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 Catalyst Media Group are associated (or correlated) with Biome Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biome Technologies Plc has no effect on the direction of Catalyst Media i.e., Catalyst Media and Biome Technologies go up and down completely randomly.
Pair Corralation between Catalyst Media and Biome Technologies
Assuming the 90 days trading horizon Catalyst Media Group is expected to generate 0.22 times more return on investment than Biome Technologies. However, Catalyst Media Group is 4.55 times less risky than Biome Technologies. It trades about -0.27 of its potential returns per unit of risk. Biome Technologies Plc is currently generating about -0.24 per unit of risk. If you would invest 7,500 in Catalyst Media Group on December 5, 2024 and sell it today you would lose (1,250) from holding Catalyst Media Group or give up 16.67% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Catalyst Media Group vs. Biome Technologies Plc
Performance |
Timeline |
Catalyst Media Group |
Biome Technologies Plc |
Catalyst Media and Biome Technologies Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Catalyst Media and Biome Technologies
The main advantage of trading using opposite Catalyst Media and Biome Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catalyst Media position performs unexpectedly, Biome Technologies 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 Biome Technologies will offset losses from the drop in Biome Technologies' long position.Catalyst Media vs. Intermediate Capital Group | Catalyst Media vs. bet at home AG | Catalyst Media vs. American Homes 4 | Catalyst Media vs. Zinc Media Group |
Biome Technologies vs. Infrastrutture Wireless Italiane | Biome Technologies vs. Chrysalis Investments | Biome Technologies vs. Lindsell Train Investment | Biome Technologies vs. Zegona Communications 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
Money Managers Screen money managers from public funds and ETFs managed around the world | |
Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
Share Portfolio Track or share privately all of your investments from the convenience of any device | |
Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |