Correlation Between Forum Merger and Khosla Ventures
Can any of the company-specific risk be diversified away by investing in both Forum Merger and Khosla Ventures 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 Forum Merger and Khosla Ventures into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Forum Merger IV and Khosla Ventures Acquisition, you can compare the effects of market volatilities on Forum Merger and Khosla Ventures 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 Forum Merger with a short position of Khosla Ventures. Check out your portfolio center. Please also check ongoing floating volatility patterns of Forum Merger and Khosla Ventures.
Diversification Opportunities for Forum Merger and Khosla Ventures
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Forum and Khosla is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Forum Merger IV and Khosla Ventures Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Khosla Ventures Acqu and Forum 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 Forum Merger IV are associated (or correlated) with Khosla Ventures. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Khosla Ventures Acqu has no effect on the direction of Forum Merger i.e., Forum Merger and Khosla Ventures go up and down completely randomly.
Pair Corralation between Forum Merger and Khosla Ventures
Given the investment horizon of 90 days Forum Merger is expected to generate 1.54 times less return on investment than Khosla Ventures. But when comparing it to its historical volatility, Forum Merger IV is 1.64 times less risky than Khosla Ventures. It trades about 0.15 of its potential returns per unit of risk. Khosla Ventures Acquisition is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 996.00 in Khosla Ventures Acquisition on September 28, 2024 and sell it today you would earn a total of 66.00 from holding Khosla Ventures Acquisition or generate 6.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 96.34% |
| Values | Daily Returns |
Forum Merger IV vs. Khosla Ventures Acquisition
Performance |
| Timeline |
| Forum Merger IV |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Khosla Ventures Acqu |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Forum Merger and Khosla Ventures Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Forum Merger and Khosla Ventures
The main advantage of trading using opposite Forum Merger and Khosla Ventures positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Forum Merger position performs unexpectedly, Khosla Ventures 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 Khosla Ventures will offset losses from the drop in Khosla Ventures' long position.| Forum Merger vs. Welsbach Technology Metals | Forum Merger vs. Broad Capital Acquisition | Forum Merger vs. Finnovate Acquisition Corp |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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