Correlation Between The National and Catalyst Exceed
Can any of the company-specific risk be diversified away by investing in both The National 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 The National and Catalyst Exceed into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The National Tax Free and Catalyst Exceed Defined, you can compare the effects of market volatilities on The National 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 The National with a short position of Catalyst Exceed. Check out your portfolio center. Please also check ongoing floating volatility patterns of The National and Catalyst Exceed.
Diversification Opportunities for The National and Catalyst Exceed
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between The and Catalyst is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding The National Tax Free 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 The National 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 The National Tax Free 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 The National i.e., The National and Catalyst Exceed go up and down completely randomly.
Pair Corralation between The National and Catalyst Exceed
Assuming the 90 days horizon The National is expected to generate 3.49 times less return on investment than Catalyst Exceed. But when comparing it to its historical volatility, The National Tax Free is 5.55 times less risky than Catalyst Exceed. It trades about 0.21 of its potential returns per unit of risk. Catalyst Exceed Defined is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 1,210 in Catalyst Exceed Defined on May 29, 2025 and sell it today you would earn a total of 68.00 from holding Catalyst Exceed Defined or generate 5.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 98.41% |
| Values | Daily Returns |
The National Tax Free vs. Catalyst Exceed Defined
Performance |
| Timeline |
| National Tax |
| Catalyst Exceed Defined |
The National and Catalyst Exceed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with The National and Catalyst Exceed
The main advantage of trading using opposite The National and Catalyst Exceed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if The National 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 National vs. The Missouri Tax Free | The National vs. The Bond Fund | The National vs. High Yield Municipal Fund | The National vs. Fidelity Intermediate Municipal |
| Catalyst Exceed vs. Great West Loomis Sayles | Catalyst Exceed vs. Goldman Sachs Small | Catalyst Exceed vs. Perkins Small Cap | Catalyst Exceed vs. Queens Road Small |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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