Correlation Between Finnovate Acquisition and LIV Capital
Can any of the company-specific risk be diversified away by investing in both Finnovate Acquisition and LIV Capital 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 Finnovate Acquisition and LIV Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Finnovate Acquisition Corp and LIV Capital Acquisition, you can compare the effects of market volatilities on Finnovate Acquisition and LIV Capital 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 Finnovate Acquisition with a short position of LIV Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Finnovate Acquisition and LIV Capital.
Diversification Opportunities for Finnovate Acquisition and LIV Capital
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Finnovate and LIV is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Finnovate Acquisition Corp and LIV Capital Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LIV Capital Acquisition and Finnovate Acquisition 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 Finnovate Acquisition Corp are associated (or correlated) with LIV Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LIV Capital Acquisition has no effect on the direction of Finnovate Acquisition i.e., Finnovate Acquisition and LIV Capital go up and down completely randomly.
Pair Corralation between Finnovate Acquisition and LIV Capital
If you would invest 1,156 in Finnovate Acquisition Corp on August 29, 2024 and sell it today you would earn a total of 6.00 from holding Finnovate Acquisition Corp or generate 0.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 4.55% |
| Values | Daily Returns |
Finnovate Acquisition Corp vs. LIV Capital Acquisition
Performance |
| Timeline |
| Finnovate Acquisition |
| LIV Capital Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Finnovate Acquisition and LIV Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Finnovate Acquisition and LIV Capital
The main advantage of trading using opposite Finnovate Acquisition and LIV Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Finnovate Acquisition position performs unexpectedly, LIV Capital 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 LIV Capital will offset losses from the drop in LIV Capital's long position.| Finnovate Acquisition vs. Broad Capital Acquisition | Finnovate Acquisition vs. Welsbach Technology Metals |
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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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