Correlation Between AA Mission and DMY Squared
Can any of the company-specific risk be diversified away by investing in both AA Mission and DMY Squared 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 AA Mission and DMY Squared into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AA Mission Acquisition and dMY Squared Technology, you can compare the effects of market volatilities on AA Mission and DMY Squared 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 AA Mission with a short position of DMY Squared. Check out your portfolio center. Please also check ongoing floating volatility patterns of AA Mission and DMY Squared.
Diversification Opportunities for AA Mission and DMY Squared
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between AAM and DMY is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding AA Mission Acquisition and dMY Squared Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on dMY Squared Technology and AA Mission 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 AA Mission Acquisition are associated (or correlated) with DMY Squared. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of dMY Squared Technology has no effect on the direction of AA Mission i.e., AA Mission and DMY Squared go up and down completely randomly.
Pair Corralation between AA Mission and DMY Squared
Considering the 90-day investment horizon AA Mission is expected to generate 2.24 times less return on investment than DMY Squared. But when comparing it to its historical volatility, AA Mission Acquisition is 4.02 times less risky than DMY Squared. It trades about 0.18 of its potential returns per unit of risk. dMY Squared Technology is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,058 in dMY Squared Technology on August 31, 2024 and sell it today you would earn a total of 7.00 from holding dMY Squared Technology or generate 0.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AA Mission Acquisition vs. dMY Squared Technology
Performance |
| Timeline |
| AA Mission Acquisition |
| dMY Squared Technology |
AA Mission and DMY Squared Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AA Mission and DMY Squared
The main advantage of trading using opposite AA Mission and DMY Squared positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AA Mission position performs unexpectedly, DMY Squared 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 DMY Squared will offset losses from the drop in DMY Squared's long position.| AA Mission vs. Voyager Acquisition Corp | AA Mission vs. dMY Squared Technology | AA Mission vs. YHN Acquisition I | AA Mission vs. CO2 Energy Transition |
| DMY Squared vs. PowerUp Acquisition Corp | DMY Squared vs. HUMANA INC | DMY Squared vs. Aquagold International | DMY Squared vs. Barloworld Ltd ADR |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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