Correlation Between DMY Squared and Graf Global
Can any of the company-specific risk be diversified away by investing in both DMY Squared and Graf Global 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 DMY Squared and Graf Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between dMY Squared Technology and Graf Global Corp, you can compare the effects of market volatilities on DMY Squared and Graf Global 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 DMY Squared with a short position of Graf Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of DMY Squared and Graf Global.
Diversification Opportunities for DMY Squared and Graf Global
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DMY and Graf is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding dMY Squared Technology and Graf Global Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Graf Global Corp and DMY Squared 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 dMY Squared Technology are associated (or correlated) with Graf Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Graf Global Corp has no effect on the direction of DMY Squared i.e., DMY Squared and Graf Global go up and down completely randomly.
Pair Corralation between DMY Squared and Graf Global
Given the investment horizon of 90 days dMY Squared Technology is expected to generate 1.31 times more return on investment than Graf Global. However, DMY Squared is 1.31 times more volatile than Graf Global Corp. It trades about 0.06 of its potential returns per unit of risk. Graf Global Corp is currently generating about -0.04 per unit of risk. If you would invest 1,060 in dMY Squared Technology on August 23, 2024 and sell it today you would earn a total of 4.00 from holding dMY Squared Technology or generate 0.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
dMY Squared Technology vs. Graf Global Corp
Performance |
| Timeline |
| dMY Squared Technology |
| Graf Global Corp |
DMY Squared and Graf Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DMY Squared and Graf Global
The main advantage of trading using opposite DMY Squared and Graf Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DMY Squared position performs unexpectedly, Graf Global 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 Graf Global will offset losses from the drop in Graf Global's long position.The idea behind dMY Squared Technology and Graf Global 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.| Graf Global vs. Distoken Acquisition | Graf Global vs. Voyager Acquisition Corp | Graf Global vs. dMY Squared Technology | Graf Global vs. YHN Acquisition I |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |