Correlation Between 51Talk Online and Catheter Precision

Can any of the company-specific risk be diversified away by investing in both 51Talk Online and Catheter Precision 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 51Talk Online and Catheter Precision into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between 51Talk Online Education and Catheter Precision, you can compare the effects of market volatilities on 51Talk Online and Catheter Precision 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 51Talk Online with a short position of Catheter Precision. Check out your portfolio center. Please also check ongoing floating volatility patterns of 51Talk Online and Catheter Precision.

Diversification Opportunities for 51Talk Online and Catheter Precision

-0.03

Correlation Coefficient

51Talk Online  Catheter Precision

Good diversification

The 3 months correlation between 51Talk and Catheter is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding 51Talk Online Education and Catheter Precision in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catheter Precision and 51Talk Online 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 51Talk Online Education are associated (or correlated) with Catheter Precision. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catheter Precision has no effect on the direction of 51Talk Online i.e., 51Talk Online and Catheter Precision go up and down completely randomly.

Pair Corralation between 51Talk Online and Catheter Precision

Considering the 90-day investment horizon 51Talk Online Education is expected to generate 0.49 times more return on investment than Catheter Precision. However, 51Talk Online Education is 2.06 times less risky than Catheter Precision. It trades about 0.08 of its potential returns per unit of risk. Catheter Precision is currently generating about -0.06 per unit of risk. If you would invest  603.00  in 51Talk Online Education on October 7, 2024 and sell it today you would earn a total of  1,366  from holding 51Talk Online Education or generate 226.53% return on investment over 90 days.

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

51Talk Online Education  vs.  Catheter Precision

51Talk Online Education

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in 51Talk Online Education are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, 51Talk Online exhibited solid returns over the last few months and may actually be approaching a breakup point.

Catheter Precision

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Catheter Precision are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite uncertain basic indicators, Catheter Precision disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with 51Talk Online and Catheter Precision

The main advantage of trading using opposite 51Talk Online and Catheter Precision positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 51Talk Online position performs unexpectedly, Catheter Precision 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 Catheter Precision will offset losses from the drop in Catheter Precision's long position.

The idea behind 51Talk Online Education and Catheter Precision 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.