Correlation Between Aldel Financial and CaliberCos
Can any of the company-specific risk be diversified away by investing in both Aldel Financial and CaliberCos 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 Aldel Financial and CaliberCos into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aldel Financial II and CaliberCos Class A, you can compare the effects of market volatilities on Aldel Financial and CaliberCos 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 Aldel Financial with a short position of CaliberCos. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aldel Financial and CaliberCos.
Diversification Opportunities for Aldel Financial and CaliberCos
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Aldel and CaliberCos is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Aldel Financial II and CaliberCos Class A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CaliberCos Class A and Aldel Financial 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 Aldel Financial II are associated (or correlated) with CaliberCos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CaliberCos Class A has no effect on the direction of Aldel Financial i.e., Aldel Financial and CaliberCos go up and down completely randomly.
Pair Corralation between Aldel Financial and CaliberCos
Given the investment horizon of 90 days Aldel Financial is expected to generate 94.46 times less return on investment than CaliberCos. But when comparing it to its historical volatility, Aldel Financial II is 45.73 times less risky than CaliberCos. It trades about 0.14 of its potential returns per unit of risk. CaliberCos Class A is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest 50.00 in CaliberCos Class A on October 14, 2024 and sell it today you would earn a total of 15.00 from holding CaliberCos Class A or generate 30.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aldel Financial II vs. CaliberCos Class A
Performance |
| Timeline |
| Aldel Financial II |
| CaliberCos Class A |
Aldel Financial and CaliberCos Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aldel Financial and CaliberCos
The main advantage of trading using opposite Aldel Financial and CaliberCos positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aldel Financial position performs unexpectedly, CaliberCos 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 CaliberCos will offset losses from the drop in CaliberCos' long position.| Aldel Financial vs. Black Spade Acquisition | Aldel Financial vs. Inflection Point Acquisition | Aldel Financial vs. Boston Beer | Aldel Financial vs. Artisan Partners Asset |
| CaliberCos vs. Summit Materials | CaliberCos vs. Aldel Financial II | CaliberCos vs. Village Super Market | CaliberCos vs. Griffon |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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