Correlation Between Vanguard Health and Catalyst Mlp

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

By analyzing existing cross correlation between Vanguard Health Care and Catalyst Mlp Infrastructure, you can compare the effects of market volatilities on Vanguard Health and Catalyst Mlp 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 Vanguard Health with a short position of Catalyst Mlp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Health and Catalyst Mlp.

Diversification Opportunities for Vanguard Health and Catalyst Mlp

-0.61

Correlation Coefficient

Vanguard Health  Catalyst Mlp

Excellent diversification

The 3 months correlation between Vanguard and Catalyst is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Health Care and Catalyst Mlp Infrastructure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalyst Mlp Infrast and Vanguard Health 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 Vanguard Health Care are associated (or correlated) with Catalyst Mlp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalyst Mlp Infrast has no effect on the direction of Vanguard Health i.e., Vanguard Health and Catalyst Mlp go up and down completely randomly.

Pair Corralation between Vanguard Health and Catalyst Mlp

Assuming the 90 days horizon Vanguard Health is expected to generate 2.61 times less return on investment than Catalyst Mlp. But when comparing it to its historical volatility, Vanguard Health Care is 1.36 times less risky than Catalyst Mlp. It trades about 0.04 of its potential returns per unit of risk. Catalyst Mlp Infrastructure is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  1,850  in Catalyst Mlp Infrastructure on July 10, 2025 and sell it today you would earn a total of  856.00  from holding Catalyst Mlp Infrastructure or generate 46.27% return on investment over 90 days.

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

Vanguard Health Care  vs.  Catalyst Mlp Infrastructure

Vanguard Health Care

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Vanguard Health Care are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Vanguard Health may actually be approaching a critical reversion point that can send shares even higher in November 2025.

Catalyst Mlp Infrast

Risk-Adjusted Performance

Weakest

Over the last 90 days Catalyst Mlp Infrastructure has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward indicators, Catalyst Mlp is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Vanguard Health and Catalyst Mlp

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

The idea behind Vanguard Health Care and Catalyst Mlp Infrastructure 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..