Correlation Between Commonwealth Global and Catalyst Exceed
Can any of the company-specific risk be diversified away by investing in both Commonwealth Global 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 Commonwealth Global and Catalyst Exceed into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Commonwealth Global Fund and Catalyst Exceed Defined, you can compare the effects of market volatilities on Commonwealth Global 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 Commonwealth Global with a short position of Catalyst Exceed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Commonwealth Global and Catalyst Exceed.
Diversification Opportunities for Commonwealth Global and Catalyst Exceed
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Commonwealth and Catalyst is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Commonwealth Global Fund 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 Commonwealth 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 Commonwealth Global Fund 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 Commonwealth Global i.e., Commonwealth Global and Catalyst Exceed go up and down completely randomly.
Pair Corralation between Commonwealth Global and Catalyst Exceed
Assuming the 90 days horizon Commonwealth Global is expected to generate 2.01 times less return on investment than Catalyst Exceed. But when comparing it to its historical volatility, Commonwealth Global Fund is 1.11 times less risky than Catalyst Exceed. It trades about 0.16 of its potential returns per unit of risk. Catalyst Exceed Defined is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 1,110 in Catalyst Exceed Defined on April 24, 2025 and sell it today you would earn a total of 167.00 from holding Catalyst Exceed Defined or generate 15.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Commonwealth Global Fund vs. Catalyst Exceed Defined
Performance |
| Timeline |
| Commonwealth Global |
| Catalyst Exceed Defined |
Commonwealth Global and Catalyst Exceed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Commonwealth Global and Catalyst Exceed
The main advantage of trading using opposite Commonwealth Global and Catalyst Exceed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Commonwealth Global 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 Commonwealth Global Fund 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.
| Catalyst Exceed vs. Multisector Bond Sma | Catalyst Exceed vs. Bbh Intermediate Municipal | Catalyst Exceed vs. Ab Bond Inflation | Catalyst Exceed vs. Leader Short Term Bond |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |