Correlation Between A SPAC and Hudson Acquisition
Can any of the company-specific risk be diversified away by investing in both A SPAC and Hudson Acquisition 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 A SPAC and Hudson Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between A SPAC II and Hudson Acquisition I, you can compare the effects of market volatilities on A SPAC and Hudson Acquisition 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 A SPAC with a short position of Hudson Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of A SPAC and Hudson Acquisition.
Diversification Opportunities for A SPAC and Hudson Acquisition
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ASCB and Hudson is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding A SPAC II and Hudson Acquisition I in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hudson Acquisition and A SPAC 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 A SPAC II are associated (or correlated) with Hudson Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hudson Acquisition has no effect on the direction of A SPAC i.e., A SPAC and Hudson Acquisition go up and down completely randomly.
Pair Corralation between A SPAC and Hudson Acquisition
Given the investment horizon of 90 days A SPAC is expected to generate 12.14 times less return on investment than Hudson Acquisition. But when comparing it to its historical volatility, A SPAC II is 2.99 times less risky than Hudson Acquisition. It trades about 0.01 of its potential returns per unit of risk. Hudson Acquisition I is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,088 in Hudson Acquisition I on August 24, 2024 and sell it today you would earn a total of 252.00 from holding Hudson Acquisition I or generate 23.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
A SPAC II vs. Hudson Acquisition I
Performance |
| Timeline |
| A SPAC II |
| Hudson Acquisition |
A SPAC and Hudson Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with A SPAC and Hudson Acquisition
The main advantage of trading using opposite A SPAC and Hudson Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if A SPAC position performs unexpectedly, Hudson Acquisition 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 Hudson Acquisition will offset losses from the drop in Hudson Acquisition's long position.The idea behind A SPAC II and Hudson Acquisition I 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.| Hudson Acquisition vs. Distoken Acquisition | Hudson Acquisition vs. Voyager Acquisition Corp | Hudson Acquisition vs. dMY Squared Technology | Hudson Acquisition vs. YHN Acquisition I |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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