Correlation Between Catalyst/aspect Enhanced and Absolute Convertible

Can any of the company-specific risk be diversified away by investing in both Catalyst/aspect Enhanced and Absolute Convertible 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/aspect Enhanced and Absolute Convertible into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Catalystaspect Enhanced Multi Asset and Absolute Convertible Arbitrage, you can compare the effects of market volatilities on Catalyst/aspect Enhanced and Absolute Convertible 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/aspect Enhanced with a short position of Absolute Convertible. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catalyst/aspect Enhanced and Absolute Convertible.

Diversification Opportunities for Catalyst/aspect Enhanced and Absolute Convertible

0.65

Correlation Coefficient

Catalyst/aspect Enhanced  Absolute Convertible

Poor diversification

The 3 months correlation between Catalyst/aspect and Absolute is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Catalystaspect Enhanced Multi and Absolute Convertible Arbitrage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Absolute Convertible and Catalyst/aspect Enhanced 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 Catalystaspect Enhanced Multi Asset are associated (or correlated) with Absolute Convertible. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Absolute Convertible has no effect on the direction of Catalyst/aspect Enhanced i.e., Catalyst/aspect Enhanced and Absolute Convertible go up and down completely randomly.

Pair Corralation between Catalyst/aspect Enhanced and Absolute Convertible

Assuming the 90 days horizon Catalystaspect Enhanced Multi Asset is expected to generate 10.7 times more return on investment than Absolute Convertible. However, Catalyst/aspect Enhanced is 10.7 times more volatile than Absolute Convertible Arbitrage. It trades about 0.17 of its potential returns per unit of risk. Absolute Convertible Arbitrage is currently generating about 0.32 per unit of risk. If you would invest  856.00  in Catalystaspect Enhanced Multi Asset on May 14, 2025 and sell it today you would earn a total of  65.00  from holding Catalystaspect Enhanced Multi Asset or generate 7.59% return on investment over 90 days.

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

Catalystaspect Enhanced Multi   vs.  Absolute Convertible Arbitrage

Catalyst/aspect Enhanced

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Catalystaspect Enhanced Multi Asset are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Catalyst/aspect Enhanced may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Absolute Convertible

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Absolute Convertible Arbitrage are ranked lower than 25 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Absolute Convertible is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Catalyst/aspect Enhanced and Absolute Convertible

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

The idea behind Catalystaspect Enhanced Multi Asset and Absolute Convertible Arbitrage 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.