Correlation Between Carlyle and AlphaTime Acquisition
Can any of the company-specific risk be diversified away by investing in both Carlyle and AlphaTime 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 Carlyle and AlphaTime Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carlyle Group and AlphaTime Acquisition Corp, you can compare the effects of market volatilities on Carlyle and AlphaTime 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 Carlyle with a short position of AlphaTime Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carlyle and AlphaTime Acquisition.
Diversification Opportunities for Carlyle and AlphaTime Acquisition
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Carlyle and AlphaTime is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Carlyle Group and AlphaTime Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AlphaTime Acquisition and Carlyle 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 Carlyle Group are associated (or correlated) with AlphaTime Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AlphaTime Acquisition has no effect on the direction of Carlyle i.e., Carlyle and AlphaTime Acquisition go up and down completely randomly.
Pair Corralation between Carlyle and AlphaTime Acquisition
Allowing for the 90-day total investment horizon Carlyle Group is expected to generate 3.2 times more return on investment than AlphaTime Acquisition. However, Carlyle is 3.2 times more volatile than AlphaTime Acquisition Corp. It trades about 0.08 of its potential returns per unit of risk. AlphaTime Acquisition Corp is currently generating about 0.04 per unit of risk. If you would invest 3,564 in Carlyle Group on September 4, 2024 and sell it today you would earn a total of 1,684 from holding Carlyle Group or generate 47.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Carlyle Group vs. AlphaTime Acquisition Corp
Performance |
| Timeline |
| Carlyle Group |
| AlphaTime Acquisition |
Carlyle and AlphaTime Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carlyle and AlphaTime Acquisition
The main advantage of trading using opposite Carlyle and AlphaTime Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carlyle position performs unexpectedly, AlphaTime 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 AlphaTime Acquisition will offset losses from the drop in AlphaTime Acquisition's long position.| Carlyle vs. Visa Class A | Carlyle vs. Diamond Hill Investment | Carlyle vs. Associated Capital Group | Carlyle vs. Brookfield Corp |
| AlphaTime Acquisition vs. Horizon Space Acquisition | AlphaTime Acquisition vs. AlphaVest Acquisition Corp | AlphaTime Acquisition vs. Israel Acquisitions 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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