Correlation Between Embrace Change and FUNR
Can any of the company-specific risk be diversified away by investing in both Embrace Change and FUNR 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 FUNR 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 FUNR, you can compare the effects of market volatilities on Embrace Change and FUNR 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 FUNR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Embrace Change and FUNR.
Diversification Opportunities for Embrace Change and FUNR
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Embrace and FUNR is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Embrace Change Acquisition and FUNR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FUNR 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 FUNR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FUNR has no effect on the direction of Embrace Change i.e., Embrace Change and FUNR go up and down completely randomly.
Pair Corralation between Embrace Change and FUNR
Given the investment horizon of 90 days Embrace Change is expected to generate 132.39 times less return on investment than FUNR. But when comparing it to its historical volatility, Embrace Change Acquisition is 176.14 times less risky than FUNR. It trades about 0.14 of its potential returns per unit of risk. FUNR is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 0.02 in FUNR on September 3, 2024 and sell it today you would lose (0.01) from holding FUNR or give up 50.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Embrace Change Acquisition vs. FUNR
Performance |
| Timeline |
| Embrace Change Acqui |
| FUNR |
Embrace Change and FUNR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Embrace Change and FUNR
The main advantage of trading using opposite Embrace Change and FUNR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Embrace Change position performs unexpectedly, FUNR 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 FUNR will offset losses from the drop in FUNR's long position.| Embrace Change vs. Absolute Health and | Embrace Change vs. Supurva Healthcare Group | Embrace Change vs. TransAKT | Embrace Change vs. HUMANA INC |
| FUNR vs. Manaris Corp | FUNR vs. Green Planet Bio | FUNR vs. Continental Beverage Brands | FUNR vs. Opus Magnum Ameris |
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.
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