Correlation Between Crescera Capital and Finnovate Acquisition
Can any of the company-specific risk be diversified away by investing in both Crescera Capital and Finnovate 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 Crescera Capital and Finnovate Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Crescera Capital Acquisition and Finnovate Acquisition Corp, you can compare the effects of market volatilities on Crescera Capital and Finnovate 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 Crescera Capital with a short position of Finnovate Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crescera Capital and Finnovate Acquisition.
Diversification Opportunities for Crescera Capital and Finnovate Acquisition
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Crescera and Finnovate is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Crescera Capital Acquisition and Finnovate Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Finnovate Acquisition and Crescera 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 Crescera Capital Acquisition are associated (or correlated) with Finnovate Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Finnovate Acquisition has no effect on the direction of Crescera Capital i.e., Crescera Capital and Finnovate Acquisition go up and down completely randomly.
Pair Corralation between Crescera Capital and Finnovate Acquisition
If you would invest 1.91 in Finnovate Acquisition Corp on September 3, 2024 and sell it today you would lose (0.01) from holding Finnovate Acquisition Corp or give up 0.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 14.29% |
| Values | Daily Returns |
Crescera Capital Acquisition vs. Finnovate Acquisition Corp
Performance |
| Timeline |
| Crescera Capital Acq |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Finnovate Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
Crescera Capital and Finnovate Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Crescera Capital and Finnovate Acquisition
The main advantage of trading using opposite Crescera Capital and Finnovate Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Crescera Capital position performs unexpectedly, Finnovate 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 Finnovate Acquisition will offset losses from the drop in Finnovate Acquisition's long position.The idea behind Crescera Capital Acquisition and Finnovate Acquisition Corp 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |