Correlation Between Embrace Change and Focus Impact
Can any of the company-specific risk be diversified away by investing in both Embrace Change and Focus Impact 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 Embrace Change and Focus Impact into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Embrace Change Acquisition and Focus Impact Acquisition, you can compare the effects of market volatilities on Embrace Change and Focus Impact 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 Embrace Change with a short position of Focus Impact. Check out your portfolio center. Please also check ongoing floating volatility patterns of Embrace Change and Focus Impact.
Diversification Opportunities for Embrace Change and Focus Impact
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Embrace and Focus is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Embrace Change Acquisition and Focus Impact Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Focus Impact Acquisition and Embrace Change 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 Embrace Change Acquisition are associated (or correlated) with Focus Impact. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Focus Impact Acquisition has no effect on the direction of Embrace Change i.e., Embrace Change and Focus Impact go up and down completely randomly.
Pair Corralation between Embrace Change and Focus Impact
Given the investment horizon of 90 days Embrace Change Acquisition is expected to generate 0.02 times more return on investment than Focus Impact. However, Embrace Change Acquisition is 56.95 times less risky than Focus Impact. It trades about 0.16 of its potential returns per unit of risk. Focus Impact Acquisition is currently generating about -0.02 per unit of risk. If you would invest 1,091 in Embrace Change Acquisition on August 24, 2024 and sell it today you would earn a total of 73.00 from holding Embrace Change Acquisition or generate 6.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 96.39% |
| Values | Daily Returns |
Embrace Change Acquisition vs. Focus Impact Acquisition
Performance |
| Timeline |
| Embrace Change Acqui |
| Focus Impact Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Embrace Change and Focus Impact Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Embrace Change and Focus Impact
The main advantage of trading using opposite Embrace Change and Focus Impact positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Embrace Change position performs unexpectedly, Focus Impact 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 Focus Impact will offset losses from the drop in Focus Impact's long position.| Embrace Change vs. China Health Management | Embrace Change vs. Absolute Health and | Embrace Change vs. Supurva Healthcare Group | Embrace Change vs. TransAKT |
| Focus Impact vs. ClimateRock Class A | Focus Impact vs. AlphaVest Acquisition Corp | Focus Impact vs. Golden Star Acquisition | Focus Impact vs. Portage Fintech Acquisition |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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