Correlation Between Cactus Acquisition and Western Asset
Can any of the company-specific risk be diversified away by investing in both Cactus Acquisition and Western Asset 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 Cactus Acquisition and Western Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cactus Acquisition Corp and Western Asset Global, you can compare the effects of market volatilities on Cactus Acquisition and Western Asset 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 Cactus Acquisition with a short position of Western Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cactus Acquisition and Western Asset.
Diversification Opportunities for Cactus Acquisition and Western Asset
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Cactus and Western is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Cactus Acquisition Corp and Western Asset Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Asset Global and Cactus 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 Cactus Acquisition Corp are associated (or correlated) with Western Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Asset Global has no effect on the direction of Cactus Acquisition i.e., Cactus Acquisition and Western Asset go up and down completely randomly.
Pair Corralation between Cactus Acquisition and Western Asset
Given the investment horizon of 90 days Cactus Acquisition Corp is expected to generate 2.11 times more return on investment than Western Asset. However, Cactus Acquisition is 2.11 times more volatile than Western Asset Global. It trades about 0.02 of its potential returns per unit of risk. Western Asset Global is currently generating about 0.04 per unit of risk. If you would invest 1,023 in Cactus Acquisition Corp on September 4, 2024 and sell it today you would earn a total of 116.00 from holding Cactus Acquisition Corp or generate 11.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Cactus Acquisition Corp vs. Western Asset Global
Performance |
| Timeline |
| Cactus Acquisition Corp |
| Western Asset Global |
Cactus Acquisition and Western Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cactus Acquisition and Western Asset
The main advantage of trading using opposite Cactus Acquisition and Western Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cactus Acquisition position performs unexpectedly, Western Asset 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 Western Asset will offset losses from the drop in Western Asset's long position.| Cactus Acquisition vs. Visa Class A | Cactus Acquisition vs. Diamond Hill Investment | Cactus Acquisition vs. Associated Capital Group | Cactus Acquisition vs. Brookfield Corp |
| Western Asset vs. Western Asset High | Western Asset vs. Western Asset Global | Western Asset vs. European Equity Closed | Western Asset vs. Doubleline Opportunistic Credit |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |