Correlation Between FTAC Emerald and Allegheny Technologies
Can any of the company-specific risk be diversified away by investing in both FTAC Emerald and Allegheny Technologies 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 FTAC Emerald and Allegheny Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FTAC Emerald Acquisition and Allegheny Technologies Incorporated, you can compare the effects of market volatilities on FTAC Emerald and Allegheny Technologies 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 FTAC Emerald with a short position of Allegheny Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of FTAC Emerald and Allegheny Technologies.
Diversification Opportunities for FTAC Emerald and Allegheny Technologies
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between FTAC and Allegheny is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding FTAC Emerald Acquisition and Allegheny Technologies Incorpo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allegheny Technologies and FTAC Emerald 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 FTAC Emerald Acquisition are associated (or correlated) with Allegheny Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allegheny Technologies has no effect on the direction of FTAC Emerald i.e., FTAC Emerald and Allegheny Technologies go up and down completely randomly.
Pair Corralation between FTAC Emerald and Allegheny Technologies
Assuming the 90 days horizon FTAC Emerald Acquisition is expected to generate 12.66 times more return on investment than Allegheny Technologies. However, FTAC Emerald is 12.66 times more volatile than Allegheny Technologies Incorporated. It trades about 0.33 of its potential returns per unit of risk. Allegheny Technologies Incorporated is currently generating about 0.31 per unit of risk. If you would invest 18.00 in FTAC Emerald Acquisition on September 1, 2024 and sell it today you would earn a total of 52.00 from holding FTAC Emerald Acquisition or generate 288.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FTAC Emerald Acquisition vs. Allegheny Technologies Incorpo
Performance |
| Timeline |
| FTAC Emerald Acquisition |
| Allegheny Technologies |
FTAC Emerald and Allegheny Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FTAC Emerald and Allegheny Technologies
The main advantage of trading using opposite FTAC Emerald and Allegheny Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FTAC Emerald position performs unexpectedly, Allegheny Technologies 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 Allegheny Technologies will offset losses from the drop in Allegheny Technologies' long position.| FTAC Emerald vs. ServiceNow | FTAC Emerald vs. CECO Environmental Corp | FTAC Emerald vs. Tianjin Capital Environmental | FTAC Emerald vs. Allegheny Technologies Incorporated |
| Allegheny Technologies vs. ESAB Corp | Allegheny Technologies vs. Insteel Industries | Allegheny Technologies vs. Northwest Pipe | Allegheny Technologies vs. Carpenter Technology |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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