Correlation Between BurTech Acquisition and TLGY Acquisition
Can any of the company-specific risk be diversified away by investing in both BurTech Acquisition and TLGY 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 BurTech Acquisition and TLGY Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BurTech Acquisition Corp and TLGY Acquisition Corp, you can compare the effects of market volatilities on BurTech Acquisition and TLGY 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 BurTech Acquisition with a short position of TLGY Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of BurTech Acquisition and TLGY Acquisition.
Diversification Opportunities for BurTech Acquisition and TLGY Acquisition
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between BurTech and TLGY is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding BurTech Acquisition Corp and TLGY Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TLGY Acquisition Corp and BurTech 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 BurTech Acquisition Corp are associated (or correlated) with TLGY Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TLGY Acquisition Corp has no effect on the direction of BurTech Acquisition i.e., BurTech Acquisition and TLGY Acquisition go up and down completely randomly.
Pair Corralation between BurTech Acquisition and TLGY Acquisition
Assuming the 90 days horizon BurTech Acquisition Corp is expected to generate 6.34 times more return on investment than TLGY Acquisition. However, BurTech Acquisition is 6.34 times more volatile than TLGY Acquisition Corp. It trades about 0.06 of its potential returns per unit of risk. TLGY Acquisition Corp is currently generating about -0.21 per unit of risk. If you would invest 1,144 in BurTech Acquisition Corp on August 25, 2024 and sell it today you would earn a total of 5.00 from holding BurTech Acquisition Corp or generate 0.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BurTech Acquisition Corp vs. TLGY Acquisition Corp
Performance |
| Timeline |
| BurTech Acquisition Corp |
| TLGY Acquisition Corp |
BurTech Acquisition and TLGY Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BurTech Acquisition and TLGY Acquisition
The main advantage of trading using opposite BurTech Acquisition and TLGY Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BurTech Acquisition position performs unexpectedly, TLGY 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 TLGY Acquisition will offset losses from the drop in TLGY Acquisition's long position.| BurTech Acquisition vs. PowerUp Acquisition Corp | BurTech Acquisition vs. Aurora Innovation | BurTech Acquisition vs. HUMANA INC | BurTech Acquisition vs. Aquagold International |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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