Correlation Between Churchill Capital and CF Acquisition
Can any of the company-specific risk be diversified away by investing in both Churchill Capital and CF 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 Churchill Capital and CF Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Churchill Capital V and CF Acquisition Corp, you can compare the effects of market volatilities on Churchill Capital and CF 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 Churchill Capital with a short position of CF Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Churchill Capital and CF Acquisition.
Diversification Opportunities for Churchill Capital and CF Acquisition
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Churchill and CFIVW is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Churchill Capital V and CF Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CF Acquisition Corp and Churchill Capital 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 Churchill Capital V are associated (or correlated) with CF Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CF Acquisition Corp has no effect on the direction of Churchill Capital i.e., Churchill Capital and CF Acquisition go up and down completely randomly.
Pair Corralation between Churchill Capital and CF Acquisition
Considering the 90-day investment horizon Churchill Capital is expected to generate 296.21 times less return on investment than CF Acquisition. But when comparing it to its historical volatility, Churchill Capital V is 53.95 times less risky than CF Acquisition. It trades about 0.02 of its potential returns per unit of risk. CF Acquisition Corp is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 4.81 in CF Acquisition Corp on September 3, 2024 and sell it today you would earn a total of 3.19 from holding CF Acquisition Corp or generate 66.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.35% |
| Values | Daily Returns |
Churchill Capital V vs. CF Acquisition Corp
Performance |
| Timeline |
| Churchill Capital |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| CF Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Churchill Capital and CF Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Churchill Capital and CF Acquisition
The main advantage of trading using opposite Churchill Capital and CF Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Churchill Capital position performs unexpectedly, CF 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 CF Acquisition will offset losses from the drop in CF Acquisition's long position.| Churchill Capital vs. In Veritas Medical | Churchill Capital vs. TMT Acquisition Corp | Churchill Capital vs. IX Acquisition 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |