Correlation Between Beard Energy and Cactus Acquisition
Can any of the company-specific risk be diversified away by investing in both Beard Energy and Cactus 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 Beard Energy and Cactus Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Beard Energy Transition and Cactus Acquisition Corp, you can compare the effects of market volatilities on Beard Energy and Cactus 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 Beard Energy with a short position of Cactus Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beard Energy and Cactus Acquisition.
Diversification Opportunities for Beard Energy and Cactus Acquisition
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Beard and Cactus is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Beard Energy Transition and Cactus Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cactus Acquisition Corp and Beard Energy 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 Beard Energy Transition are associated (or correlated) with Cactus Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cactus Acquisition Corp has no effect on the direction of Beard Energy i.e., Beard Energy and Cactus Acquisition go up and down completely randomly.
Pair Corralation between Beard Energy and Cactus Acquisition
Considering the 90-day investment horizon Beard Energy is expected to generate 168.5 times less return on investment than Cactus Acquisition. But when comparing it to its historical volatility, Beard Energy Transition is 7.18 times less risky than Cactus Acquisition. It trades about 0.0 of its potential returns per unit of risk. Cactus Acquisition Corp is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,063 in Cactus Acquisition Corp on September 12, 2024 and sell it today you would earn a total of 76.00 from holding Cactus Acquisition Corp or generate 7.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 1.14% |
| Values | Daily Returns |
Beard Energy Transition vs. Cactus Acquisition Corp
Performance |
| Timeline |
| Beard Energy Transition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Cactus Acquisition Corp |
Beard Energy and Cactus Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beard Energy and Cactus Acquisition
The main advantage of trading using opposite Beard Energy and Cactus Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beard Energy position performs unexpectedly, Cactus 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 Cactus Acquisition will offset losses from the drop in Cactus Acquisition's long position.| Beard Energy vs. PowerUp Acquisition Corp | Beard Energy vs. Everest Consolidator Acquisition | Beard Energy vs. Valuence Merger Corp |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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