Correlation Between Moderately Aggressive and Catalyst Intelligent

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

By analyzing existing cross correlation between Moderately Aggressive Balanced and Catalyst Intelligent Alternative, you can compare the effects of market volatilities on Moderately Aggressive and Catalyst Intelligent 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 Moderately Aggressive with a short position of Catalyst Intelligent. Check out your portfolio center. Please also check ongoing floating volatility patterns of Moderately Aggressive and Catalyst Intelligent.

Diversification Opportunities for Moderately Aggressive and Catalyst Intelligent

0.93

Correlation Coefficient

Moderately Aggressive  Catalyst Intelligent

Almost no diversification

The 3 months correlation between Moderately and Catalyst is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Moderately Aggressive Balanced and Catalyst Intelligent Alternati in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalyst Intelligent and Moderately Aggressive 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 Moderately Aggressive Balanced are associated (or correlated) with Catalyst Intelligent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalyst Intelligent has no effect on the direction of Moderately Aggressive i.e., Moderately Aggressive and Catalyst Intelligent go up and down completely randomly.

Pair Corralation between Moderately Aggressive and Catalyst Intelligent

Assuming the 90 days horizon Moderately Aggressive is expected to generate 1.7 times less return on investment than Catalyst Intelligent. But when comparing it to its historical volatility, Moderately Aggressive Balanced is 1.56 times less risky than Catalyst Intelligent. It trades about 0.19 of its potential returns per unit of risk. Catalyst Intelligent Alternative is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest  887.00  in Catalyst Intelligent Alternative on May 12, 2025 and sell it today you would earn a total of  87.00  from holding Catalyst Intelligent Alternative or generate 9.81% return on investment over 90 days.

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

Moderately Aggressive Balanced  vs.  Catalyst Intelligent Alternati

Moderately Aggressive

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Moderately Aggressive Balanced are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Moderately Aggressive is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Catalyst Intelligent

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Catalyst Intelligent Alternative are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Catalyst Intelligent may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Moderately Aggressive and Catalyst Intelligent

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

The idea behind Moderately Aggressive Balanced and Catalyst Intelligent Alternative 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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.