Correlation Between ACAB Old and Athena Consumer
Can any of the company-specific risk be diversified away by investing in both ACAB Old and Athena Consumer 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 ACAB Old and Athena Consumer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ACAB Old and Athena Consumer Acquisition, you can compare the effects of market volatilities on ACAB Old and Athena Consumer 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 ACAB Old with a short position of Athena Consumer. Check out your portfolio center. Please also check ongoing floating volatility patterns of ACAB Old and Athena Consumer.
Diversification Opportunities for ACAB Old and Athena Consumer
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ACAB and Athena is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding ACAB Old and Athena Consumer Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Athena Consumer Acqu and ACAB Old 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 ACAB Old are associated (or correlated) with Athena Consumer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Athena Consumer Acqu has no effect on the direction of ACAB Old i.e., ACAB Old and Athena Consumer go up and down completely randomly.
Pair Corralation between ACAB Old and Athena Consumer
If you would invest 1,143 in Athena Consumer Acquisition on October 26, 2024 and sell it today you would earn a total of 0.00 from holding Athena Consumer Acquisition or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ACAB Old vs. Athena Consumer Acquisition
Performance |
| Timeline |
| ACAB Old |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Athena Consumer Acqu |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
ACAB Old and Athena Consumer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ACAB Old and Athena Consumer
The main advantage of trading using opposite ACAB Old and Athena Consumer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ACAB Old position performs unexpectedly, Athena Consumer 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 Athena Consumer will offset losses from the drop in Athena Consumer's long position.The idea behind ACAB Old and Athena Consumer Acquisition 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.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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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