Correlation Between Concord Acquisition and Industrial Tech
Can any of the company-specific risk be diversified away by investing in both Concord Acquisition and Industrial Tech 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 Concord Acquisition and Industrial Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Concord Acquisition Corp and Industrial Tech Acquisitions, you can compare the effects of market volatilities on Concord Acquisition and Industrial Tech 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 Concord Acquisition with a short position of Industrial Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Concord Acquisition and Industrial Tech.
Diversification Opportunities for Concord Acquisition and Industrial Tech
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Concord and Industrial is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Concord Acquisition Corp and Industrial Tech Acquisitions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Industrial Tech Acqu and Concord 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 Concord Acquisition Corp are associated (or correlated) with Industrial Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Industrial Tech Acqu has no effect on the direction of Concord Acquisition i.e., Concord Acquisition and Industrial Tech go up and down completely randomly.
Pair Corralation between Concord Acquisition and Industrial Tech
If you would invest 1,038 in Concord Acquisition Corp on August 26, 2024 and sell it today you would lose (1,038) from holding Concord Acquisition Corp or give up 100.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 0.61% |
| Values | Daily Returns |
Concord Acquisition Corp vs. Industrial Tech Acquisitions
Performance |
| Timeline |
| Concord Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Industrial Tech Acqu |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Concord Acquisition and Industrial Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Concord Acquisition and Industrial Tech
The main advantage of trading using opposite Concord Acquisition and Industrial Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Concord Acquisition position performs unexpectedly, Industrial Tech 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 Industrial Tech will offset losses from the drop in Industrial Tech's long position.The idea behind Concord Acquisition Corp and Industrial Tech Acquisitions 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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