Correlation Between Catalyst Pharmaceuticals and Eni SPA
Can any of the company-specific risk be diversified away by investing in both Catalyst Pharmaceuticals and Eni SPA 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 Catalyst Pharmaceuticals and Eni SPA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Catalyst Pharmaceuticals and Eni SpA ADR, you can compare the effects of market volatilities on Catalyst Pharmaceuticals and Eni SPA 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 Catalyst Pharmaceuticals with a short position of Eni SPA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catalyst Pharmaceuticals and Eni SPA.
Diversification Opportunities for Catalyst Pharmaceuticals and Eni SPA
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Catalyst and Eni is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Catalyst Pharmaceuticals and Eni SpA ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eni SpA ADR and Catalyst Pharmaceuticals 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 Catalyst Pharmaceuticals are associated (or correlated) with Eni SPA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eni SpA ADR has no effect on the direction of Catalyst Pharmaceuticals i.e., Catalyst Pharmaceuticals and Eni SPA go up and down completely randomly.
Pair Corralation between Catalyst Pharmaceuticals and Eni SPA
Given the investment horizon of 90 days Catalyst Pharmaceuticals is expected to under-perform the Eni SPA. In addition to that, Catalyst Pharmaceuticals is 1.92 times more volatile than Eni SpA ADR. It trades about -0.11 of its total potential returns per unit of risk. Eni SpA ADR is currently generating about 0.13 per unit of volatility. If you would invest 3,184 in Eni SpA ADR on January 29, 2024 and sell it today you would earn a total of 96.00 from holding Eni SpA ADR or generate 3.02% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Catalyst Pharmaceuticals vs. Eni SpA ADR
Performance |
Timeline |
Catalyst Pharmaceuticals |
Eni SpA ADR |
Catalyst Pharmaceuticals and Eni SPA Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Catalyst Pharmaceuticals and Eni SPA
The main advantage of trading using opposite Catalyst Pharmaceuticals and Eni SPA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catalyst Pharmaceuticals position performs unexpectedly, Eni SPA 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 Eni SPA will offset losses from the drop in Eni SPA's long position.Catalyst Pharmaceuticals vs. Day One Biopharmaceuticals | Catalyst Pharmaceuticals vs. Terns Pharmaceuticals | Catalyst Pharmaceuticals vs. X4 Pharmaceuticals | Catalyst Pharmaceuticals vs. Inozyme PharmaInc |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
Transaction History View history of all your transactions and understand their impact on performance | |
Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
Stocks Directory Find actively traded stocks across global markets | |
Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
Bonds Directory Find actively traded corporate debentures issued by US companies |