Correlation Between Catalystmap Global and Catalyst/lyons Tactical
Can any of the company-specific risk be diversified away by investing in both Catalystmap Global and Catalyst/lyons Tactical 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 Catalystmap Global and Catalyst/lyons Tactical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Catalystmap Global Balanced and Catalystlyons Tactical Allocation, you can compare the effects of market volatilities on Catalystmap Global and Catalyst/lyons Tactical 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 Catalystmap Global with a short position of Catalyst/lyons Tactical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catalystmap Global and Catalyst/lyons Tactical.
Diversification Opportunities for Catalystmap Global and Catalyst/lyons Tactical
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Catalystmap and Catalyst/lyons is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Catalystmap Global Balanced and Catalystlyons Tactical Allocat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalyst/lyons Tactical and Catalystmap Global 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 Catalystmap Global Balanced are associated (or correlated) with Catalyst/lyons Tactical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalyst/lyons Tactical has no effect on the direction of Catalystmap Global i.e., Catalystmap Global and Catalyst/lyons Tactical go up and down completely randomly.
Pair Corralation between Catalystmap Global and Catalyst/lyons Tactical
Assuming the 90 days horizon Catalystmap Global is expected to generate 1.83 times less return on investment than Catalyst/lyons Tactical. But when comparing it to its historical volatility, Catalystmap Global Balanced is 2.74 times less risky than Catalyst/lyons Tactical. It trades about 0.33 of its potential returns per unit of risk. Catalystlyons Tactical Allocation is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 1,448 in Catalystlyons Tactical Allocation on April 24, 2025 and sell it today you would earn a total of 155.00 from holding Catalystlyons Tactical Allocation or generate 10.7% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Catalystmap Global Balanced vs. Catalystlyons Tactical Allocat
Performance |
Timeline |
Catalystmap Global |
Catalyst/lyons Tactical |
Catalystmap Global and Catalyst/lyons Tactical Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Catalystmap Global and Catalyst/lyons Tactical
The main advantage of trading using opposite Catalystmap Global and Catalyst/lyons Tactical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catalystmap Global position performs unexpectedly, Catalyst/lyons Tactical 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/lyons Tactical will offset losses from the drop in Catalyst/lyons Tactical's long position.Catalystmap Global vs. Locorr Strategic Allocation | Catalystmap Global vs. Aqr Large Cap | Catalystmap Global vs. Balanced Allocation Fund | Catalystmap Global vs. T Rowe Price |
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Check out your portfolio center.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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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