Correlation Between Concord Acquisition and Cascadia Acquisition
Can any of the company-specific risk be diversified away by investing in both Concord Acquisition and Cascadia 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 Concord Acquisition and Cascadia Acquisition 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 Cascadia Acquisition Corp, you can compare the effects of market volatilities on Concord Acquisition and Cascadia 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 Concord Acquisition with a short position of Cascadia Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Concord Acquisition and Cascadia Acquisition.
Diversification Opportunities for Concord Acquisition and Cascadia Acquisition
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Concord and Cascadia is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Concord Acquisition Corp and Cascadia Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cascadia Acquisition Corp 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 Cascadia Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cascadia Acquisition Corp has no effect on the direction of Concord Acquisition i.e., Concord Acquisition and Cascadia Acquisition go up and down completely randomly.
Pair Corralation between Concord Acquisition and Cascadia Acquisition
Given the investment horizon of 90 days Concord Acquisition is expected to generate 1594.75 times less return on investment than Cascadia Acquisition. But when comparing it to its historical volatility, Concord Acquisition Corp is 867.33 times less risky than Cascadia Acquisition. It trades about 0.1 of its potential returns per unit of risk. Cascadia Acquisition Corp is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 5.00 in Cascadia Acquisition Corp on September 1, 2024 and sell it today you would earn a total of 3.51 from holding Cascadia Acquisition Corp or generate 70.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 90.0% |
| Values | Daily Returns |
Concord Acquisition Corp vs. Cascadia Acquisition Corp
Performance |
| Timeline |
| Concord Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Cascadia Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Concord Acquisition and Cascadia Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Concord Acquisition and Cascadia Acquisition
The main advantage of trading using opposite Concord Acquisition and Cascadia Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Concord Acquisition position performs unexpectedly, Cascadia 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 Cascadia Acquisition will offset losses from the drop in Cascadia Acquisition's long position.| Concord Acquisition vs. Thunder Bridge Capital | Concord Acquisition vs. Welsbach Technology Metals | Concord Acquisition vs. Hudson Acquisition I | Concord Acquisition vs. Marblegate 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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