Correlation Between A SPAC and Tristar Acquisition
Can any of the company-specific risk be diversified away by investing in both A SPAC and Tristar 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 Tristar 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 Tristar Acquisition I, you can compare the effects of market volatilities on A SPAC and Tristar 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 Tristar Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of A SPAC and Tristar Acquisition.
Diversification Opportunities for A SPAC and Tristar Acquisition
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between ASCB and Tristar is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding A SPAC II and Tristar Acquisition I in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tristar 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 Tristar Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tristar Acquisition has no effect on the direction of A SPAC i.e., A SPAC and Tristar Acquisition go up and down completely randomly.
Pair Corralation between A SPAC and Tristar Acquisition
Given the investment horizon of 90 days A SPAC II is expected to generate 0.18 times more return on investment than Tristar Acquisition. However, A SPAC II is 5.46 times less risky than Tristar Acquisition. It trades about 0.02 of its potential returns per unit of risk. Tristar Acquisition I is currently generating about -0.04 per unit of risk. If you would invest 1,015 in A SPAC II on September 3, 2024 and sell it today you would earn a total of 81.00 from holding A SPAC II or generate 7.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 73.74% |
| Values | Daily Returns |
A SPAC II vs. Tristar Acquisition I
Performance |
| Timeline |
| A SPAC II |
| Tristar Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
A SPAC and Tristar Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with A SPAC and Tristar Acquisition
The main advantage of trading using opposite A SPAC and Tristar Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if A SPAC position performs unexpectedly, Tristar 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 Tristar Acquisition will offset losses from the drop in Tristar Acquisition's long position.| A SPAC vs. Western Asset Global | A SPAC vs. Invesco Trust For | A SPAC vs. Logan Ridge Finance | A SPAC vs. Invesco Advantage MIT |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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