Correlation Between Minerals Technologies and Cathay General
Can any of the company-specific risk be diversified away by investing in both Minerals Technologies and Cathay General 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 Minerals Technologies and Cathay General into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Minerals Technologies and Cathay General Bancorp, you can compare the effects of market volatilities on Minerals Technologies and Cathay General 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 Minerals Technologies with a short position of Cathay General. Check out your portfolio center. Please also check ongoing floating volatility patterns of Minerals Technologies and Cathay General.
Diversification Opportunities for Minerals Technologies and Cathay General
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Minerals and Cathay is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Minerals Technologies and Cathay General Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cathay General Bancorp and Minerals Technologies 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 Minerals Technologies are associated (or correlated) with Cathay General. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cathay General Bancorp has no effect on the direction of Minerals Technologies i.e., Minerals Technologies and Cathay General go up and down completely randomly.
Pair Corralation between Minerals Technologies and Cathay General
Considering the 90-day investment horizon Minerals Technologies is expected to under-perform the Cathay General. But the stock apears to be less risky and, when comparing its historical volatility, Minerals Technologies is 1.14 times less risky than Cathay General. The stock trades about -0.02 of its potential returns per unit of risk. The Cathay General Bancorp is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 4,879 in Cathay General Bancorp on September 12, 2025 and sell it today you would earn a total of 143.00 from holding Cathay General Bancorp or generate 2.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Minerals Technologies vs. Cathay General Bancorp
Performance |
| Timeline |
| Minerals Technologies |
| Cathay General Bancorp |
Minerals Technologies and Cathay General Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Minerals Technologies and Cathay General
The main advantage of trading using opposite Minerals Technologies and Cathay General positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Minerals Technologies position performs unexpectedly, Cathay General 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 Cathay General will offset losses from the drop in Cathay General's long position.| Minerals Technologies vs. Innospec | Minerals Technologies vs. Chemours Co | Minerals Technologies vs. Ingevity Corp | Minerals Technologies vs. Ashland Global Holdings |
| Cathay General vs. Fulton Financial | Cathay General vs. First Bancorp | Cathay General vs. BankUnited | Cathay General vs. WSFS Financial |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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