Correlation Between Frontier Investment and BurTech Acquisition
Can any of the company-specific risk be diversified away by investing in both Frontier Investment and BurTech 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 Frontier Investment and BurTech Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Frontier Investment Corp and BurTech Acquisition Corp, you can compare the effects of market volatilities on Frontier Investment and BurTech 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 Frontier Investment with a short position of BurTech Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Frontier Investment and BurTech Acquisition.
Diversification Opportunities for Frontier Investment and BurTech Acquisition
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Frontier and BurTech is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Frontier Investment Corp and BurTech Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BurTech Acquisition Corp and Frontier Investment 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 Frontier Investment Corp are associated (or correlated) with BurTech Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BurTech Acquisition Corp has no effect on the direction of Frontier Investment i.e., Frontier Investment and BurTech Acquisition go up and down completely randomly.
Pair Corralation between Frontier Investment and BurTech Acquisition
Given the investment horizon of 90 days Frontier Investment Corp is expected to generate 1.57 times more return on investment than BurTech Acquisition. However, Frontier Investment is 1.57 times more volatile than BurTech Acquisition Corp. It trades about 0.08 of its potential returns per unit of risk. BurTech Acquisition Corp is currently generating about 0.09 per unit of risk. If you would invest 1,006 in Frontier Investment Corp on September 3, 2024 and sell it today you would earn a total of 44.00 from holding Frontier Investment Corp or generate 4.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 27.79% |
| Values | Daily Returns |
Frontier Investment Corp vs. BurTech Acquisition Corp
Performance |
| Timeline |
| Frontier Investment Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| BurTech Acquisition Corp |
Frontier Investment and BurTech Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Frontier Investment and BurTech Acquisition
The main advantage of trading using opposite Frontier Investment and BurTech Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Frontier Investment position performs unexpectedly, BurTech 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 BurTech Acquisition will offset losses from the drop in BurTech Acquisition's long position.| Frontier Investment vs. Mars Acquisition Corp | Frontier Investment vs. AlphaTime Acquisition Corp | Frontier Investment vs. BurTech Acquisition Corp | Frontier Investment vs. Manaris Corp |
| BurTech Acquisition vs. Alpha One | BurTech Acquisition vs. Manaris Corp | BurTech Acquisition vs. SCOR PK | BurTech Acquisition vs. Aquagold International |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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