Correlation Between FinServ Acquisition and Senior Connect
Can any of the company-specific risk be diversified away by investing in both FinServ Acquisition and Senior Connect 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 FinServ Acquisition and Senior Connect into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FinServ Acquisition Corp and Senior Connect Acquisition, you can compare the effects of market volatilities on FinServ Acquisition and Senior Connect 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 FinServ Acquisition with a short position of Senior Connect. Check out your portfolio center. Please also check ongoing floating volatility patterns of FinServ Acquisition and Senior Connect.
Diversification Opportunities for FinServ Acquisition and Senior Connect
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between FinServ and Senior is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding FinServ Acquisition Corp and Senior Connect Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Senior Connect Acqui and FinServ 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 FinServ Acquisition Corp are associated (or correlated) with Senior Connect. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Senior Connect Acqui has no effect on the direction of FinServ Acquisition i.e., FinServ Acquisition and Senior Connect go up and down completely randomly.
Pair Corralation between FinServ Acquisition and Senior Connect
If you would invest 0.04 in Senior Connect Acquisition on September 1, 2024 and sell it today you would earn a total of 0.00 from holding Senior Connect Acquisition or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FinServ Acquisition Corp vs. Senior Connect Acquisition
Performance |
| Timeline |
| FinServ Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Senior Connect Acqui |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
FinServ Acquisition and Senior Connect Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FinServ Acquisition and Senior Connect
The main advantage of trading using opposite FinServ Acquisition and Senior Connect positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FinServ Acquisition position performs unexpectedly, Senior Connect 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 Senior Connect will offset losses from the drop in Senior Connect's long position.The idea behind FinServ Acquisition Corp and Senior Connect Acquisition pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |