Correlation Between Cascadia Acquisition and UMAX Group
Can any of the company-specific risk be diversified away by investing in both Cascadia Acquisition and UMAX Group 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 Cascadia Acquisition and UMAX Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cascadia Acquisition Corp and UMAX Group Corp, you can compare the effects of market volatilities on Cascadia Acquisition and UMAX Group 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 Cascadia Acquisition with a short position of UMAX Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cascadia Acquisition and UMAX Group.
Diversification Opportunities for Cascadia Acquisition and UMAX Group
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Cascadia and UMAX is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Cascadia Acquisition Corp and UMAX Group Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UMAX Group Corp and Cascadia 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 Cascadia Acquisition Corp are associated (or correlated) with UMAX Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UMAX Group Corp has no effect on the direction of Cascadia Acquisition i.e., Cascadia Acquisition and UMAX Group go up and down completely randomly.
Pair Corralation between Cascadia Acquisition and UMAX Group
If you would invest 0.01 in UMAX Group Corp on September 12, 2024 and sell it today you would earn a total of 0.00 from holding UMAX Group Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 1.56% |
| Values | Daily Returns |
Cascadia Acquisition Corp vs. UMAX Group Corp
Performance |
| Timeline |
| Cascadia Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| UMAX Group Corp |
Cascadia Acquisition and UMAX Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cascadia Acquisition and UMAX Group
The main advantage of trading using opposite Cascadia Acquisition and UMAX Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cascadia Acquisition position performs unexpectedly, UMAX Group 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 UMAX Group will offset losses from the drop in UMAX Group's long position.The idea behind Cascadia Acquisition Corp and UMAX Group Corp 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.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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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