Correlation Between FG Merger and Signal Hill
Can any of the company-specific risk be diversified away by investing in both FG Merger and Signal Hill 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 FG Merger and Signal Hill into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FG Merger Corp and Signal Hill Acquisition, you can compare the effects of market volatilities on FG Merger and Signal Hill 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 FG Merger with a short position of Signal Hill. Check out your portfolio center. Please also check ongoing floating volatility patterns of FG Merger and Signal Hill.
Diversification Opportunities for FG Merger and Signal Hill
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between FGMCW and Signal is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding FG Merger Corp and Signal Hill Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Signal Hill Acquisition and FG Merger 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 FG Merger Corp are associated (or correlated) with Signal Hill. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Signal Hill Acquisition has no effect on the direction of FG Merger i.e., FG Merger and Signal Hill go up and down completely randomly.
Pair Corralation between FG Merger and Signal Hill
If you would invest 0.09 in Signal Hill Acquisition on November 2, 2024 and sell it today you would earn a total of 0.00 from holding Signal Hill Acquisition or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FG Merger Corp vs. Signal Hill Acquisition
Performance |
| Timeline |
| FG Merger Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Signal Hill Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
FG Merger and Signal Hill Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FG Merger and Signal Hill
The main advantage of trading using opposite FG Merger and Signal Hill positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FG Merger position performs unexpectedly, Signal Hill 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 Signal Hill will offset losses from the drop in Signal Hill's long position.| FG Merger vs. Molson Coors Brewing | FG Merger vs. Ambev SA ADR | FG Merger vs. Universal | FG Merger vs. Cardinal Health |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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