Correlation Between Semiconductor Ultrasector and Catalyst Exceed

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

By analyzing existing cross correlation between Semiconductor Ultrasector Profund and Catalyst Exceed Defined, you can compare the effects of market volatilities on Semiconductor Ultrasector and Catalyst Exceed 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 Semiconductor Ultrasector with a short position of Catalyst Exceed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Semiconductor Ultrasector and Catalyst Exceed.

Diversification Opportunities for Semiconductor Ultrasector and Catalyst Exceed

0.96

Correlation Coefficient

Semiconductor Ultrasector  Catalyst Exceed

Almost no diversification

The 3 months correlation between Semiconductor and Catalyst is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Semiconductor Ultrasector Prof and Catalyst Exceed Defined in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalyst Exceed Defined and Semiconductor Ultrasector 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 Semiconductor Ultrasector Profund are associated (or correlated) with Catalyst Exceed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalyst Exceed Defined has no effect on the direction of Semiconductor Ultrasector i.e., Semiconductor Ultrasector and Catalyst Exceed go up and down completely randomly.

Pair Corralation between Semiconductor Ultrasector and Catalyst Exceed

Assuming the 90 days horizon Semiconductor Ultrasector Profund is expected to generate 3.1 times more return on investment than Catalyst Exceed. However, Semiconductor Ultrasector is 3.1 times more volatile than Catalyst Exceed Defined. It trades about 0.45 of its potential returns per unit of risk. Catalyst Exceed Defined is currently generating about 0.34 per unit of risk. If you would invest  2,640  in Semiconductor Ultrasector Profund on April 23, 2025 and sell it today you would earn a total of  2,549  from holding Semiconductor Ultrasector Profund or generate 96.55% return on investment over 90 days.

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

Semiconductor Ultrasector Prof  vs.  Catalyst Exceed Defined

Semiconductor Ultrasector

Risk-Adjusted Performance

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Semiconductor Ultrasector Profund are ranked lower than 35 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Semiconductor Ultrasector showed solid returns over the last few months and may actually be approaching a breakup point.

Catalyst Exceed Defined

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Catalyst Exceed Defined are ranked lower than 26 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Catalyst Exceed showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Semiconductor Ultrasector and Catalyst Exceed

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

The idea behind Semiconductor Ultrasector Profund and Catalyst Exceed Defined 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.