Correlation Between Cactus Acquisition and Cartesian Growth
Can any of the company-specific risk be diversified away by investing in both Cactus Acquisition and Cartesian Growth 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 Cartesian Growth 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 Cartesian Growth, you can compare the effects of market volatilities on Cactus Acquisition and Cartesian Growth 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 Cartesian Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cactus Acquisition and Cartesian Growth.
Diversification Opportunities for Cactus Acquisition and Cartesian Growth
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Cactus and Cartesian is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Cactus Acquisition Corp and Cartesian Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cartesian Growth 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 Cartesian Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cartesian Growth has no effect on the direction of Cactus Acquisition i.e., Cactus Acquisition and Cartesian Growth go up and down completely randomly.
Pair Corralation between Cactus Acquisition and Cartesian Growth
Given the investment horizon of 90 days Cactus Acquisition Corp is expected to generate 3.63 times more return on investment than Cartesian Growth. However, Cactus Acquisition is 3.63 times more volatile than Cartesian Growth. It trades about 0.01 of its potential returns per unit of risk. Cartesian Growth is currently generating about 0.05 per unit of risk. If you would invest 1,125 in Cactus Acquisition Corp on September 13, 2024 and sell it today you would earn a total of 14.00 from holding Cactus Acquisition Corp or generate 1.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cactus Acquisition Corp vs. Cartesian Growth
Performance |
| Timeline |
| Cactus Acquisition Corp |
| Cartesian Growth |
Cactus Acquisition and Cartesian Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cactus Acquisition and Cartesian Growth
The main advantage of trading using opposite Cactus Acquisition and Cartesian Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cactus Acquisition position performs unexpectedly, Cartesian Growth 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 Cartesian Growth will offset losses from the drop in Cartesian Growth's long position.| Cactus Acquisition vs. Visa Class A | Cactus Acquisition vs. Diamond Hill Investment | Cactus Acquisition vs. Distoken Acquisition | Cactus Acquisition vs. AllianceBernstein Holding LP |
| Cartesian Growth vs. Investcorp India Acquisition | Cartesian Growth vs. Rf Acquisition Corp | Cartesian Growth vs. Metal Sky Star |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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