Correlation Between Bassline Productions and Cato

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

By analyzing existing cross correlation between Bassline Productions and Cato Corporation, you can compare the effects of market volatilities on Bassline Productions and Cato 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 Bassline Productions with a short position of Cato. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bassline Productions and Cato.

Diversification Opportunities for Bassline Productions and Cato

0.0

Correlation Coefficient

Bassline Productions  Cato

Pay attention - limited upside

The 3 months correlation between Bassline and Cato is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Bassline Productions and Cato Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cato and Bassline Productions 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 Bassline Productions are associated (or correlated) with Cato. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cato has no effect on the direction of Bassline Productions i.e., Bassline Productions and Cato go up and down completely randomly.

Pair Corralation between Bassline Productions and Cato

If you would invest  231.00  in Cato Corporation on May 5, 2025 and sell it today you would earn a total of  48.00  from holding Cato Corporation or generate 20.78% return on investment over 90 days.

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

Bassline Productions  vs.  Cato Corp.

Bassline Productions

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bassline Productions has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Bassline Productions is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Cato

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Cato Corporation are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Cato displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Bassline Productions and Cato

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

The idea behind Bassline Productions and Cato Corporation 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.