Correlation Between Empire State and CF Acquisition
Can any of the company-specific risk be diversified away by investing in both Empire State and CF 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 Empire State and CF Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Empire State Realty and CF Acquisition IV, you can compare the effects of market volatilities on Empire State and CF 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 Empire State with a short position of CF Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Empire State and CF Acquisition.
Diversification Opportunities for Empire State and CF Acquisition
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Empire and CFIV is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Empire State Realty and CF Acquisition IV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CF Acquisition IV and Empire State 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 Empire State Realty are associated (or correlated) with CF Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CF Acquisition IV has no effect on the direction of Empire State i.e., Empire State and CF Acquisition go up and down completely randomly.
Pair Corralation between Empire State and CF Acquisition
If you would invest 1,108 in Empire State Realty on August 29, 2024 and sell it today you would earn a total of 17.00 from holding Empire State Realty or generate 1.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 2.33% |
| Values | Daily Returns |
Empire State Realty vs. CF Acquisition IV
Performance |
| Timeline |
| Empire State Realty |
| CF Acquisition IV |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Empire State and CF Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Empire State and CF Acquisition
The main advantage of trading using opposite Empire State and CF Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Empire State position performs unexpectedly, CF 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 CF Acquisition will offset losses from the drop in CF Acquisition's long position.| Empire State vs. Paramount Group | Empire State vs. Hudson Pacific Properties | Empire State vs. Equity Commonwealth | Empire State vs. Douglas Emmett |
| CF Acquisition vs. Finnovate Acquisition Corp | CF Acquisition vs. IX Acquisition Corp | CF Acquisition vs. LatAmGrowth SPAC |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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