Correlation Between AGBA Acquisition and Breeze Holdings
Can any of the company-specific risk be diversified away by investing in both AGBA Acquisition and Breeze Holdings 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 AGBA Acquisition and Breeze Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AGBA Acquisition Limited and Breeze Holdings Acquisition, you can compare the effects of market volatilities on AGBA Acquisition and Breeze Holdings 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 AGBA Acquisition with a short position of Breeze Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of AGBA Acquisition and Breeze Holdings.
Diversification Opportunities for AGBA Acquisition and Breeze Holdings
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AGBA and Breeze is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding AGBA Acquisition Limited and Breeze Holdings Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Breeze Holdings Acqu and AGBA Acquisition 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 AGBA Acquisition Limited are associated (or correlated) with Breeze Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Breeze Holdings Acqu has no effect on the direction of AGBA Acquisition i.e., AGBA Acquisition and Breeze Holdings go up and down completely randomly.
Pair Corralation between AGBA Acquisition and Breeze Holdings
If you would invest 34.00 in AGBA Acquisition Limited on September 1, 2024 and sell it today you would lose (13.00) from holding AGBA Acquisition Limited or give up 38.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 1.04% |
| Values | Daily Returns |
AGBA Acquisition Limited vs. Breeze Holdings Acquisition
Performance |
| Timeline |
| AGBA Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Breeze Holdings Acqu |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
AGBA Acquisition and Breeze Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AGBA Acquisition and Breeze Holdings
The main advantage of trading using opposite AGBA Acquisition and Breeze Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AGBA Acquisition position performs unexpectedly, Breeze Holdings 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 Breeze Holdings will offset losses from the drop in Breeze Holdings' long position.The idea behind AGBA Acquisition Limited and Breeze Holdings 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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