Correlation Between Generation Asia and Athena Technology
Can any of the company-specific risk be diversified away by investing in both Generation Asia and Athena Technology 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 Generation Asia and Athena Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Generation Asia I and Athena Technology Acquisition, you can compare the effects of market volatilities on Generation Asia and Athena Technology 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 Generation Asia with a short position of Athena Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Generation Asia and Athena Technology.
Diversification Opportunities for Generation Asia and Athena Technology
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Generation and Athena is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Generation Asia I and Athena Technology Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Athena Technology and Generation Asia 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 Generation Asia I are associated (or correlated) with Athena Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Athena Technology has no effect on the direction of Generation Asia i.e., Generation Asia and Athena Technology go up and down completely randomly.
Pair Corralation between Generation Asia and Athena Technology
Considering the 90-day investment horizon Generation Asia is expected to generate 1.72 times less return on investment than Athena Technology. But when comparing it to its historical volatility, Generation Asia I is 4.31 times less risky than Athena Technology. It trades about 0.1 of its potential returns per unit of risk. Athena Technology Acquisition is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,037 in Athena Technology Acquisition on September 2, 2024 and sell it today you would earn a total of 155.00 from holding Athena Technology Acquisition or generate 14.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 96.51% |
| Values | Daily Returns |
Generation Asia I vs. Athena Technology Acquisition
Performance |
| Timeline |
| Generation Asia I |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
| Athena Technology |
Generation Asia and Athena Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Generation Asia and Athena Technology
The main advantage of trading using opposite Generation Asia and Athena Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Generation Asia position performs unexpectedly, Athena Technology 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 Athena Technology will offset losses from the drop in Athena Technology's long position.| Generation Asia vs. Green Planet Bio | Generation Asia vs. Opus Magnum Ameris | Generation Asia vs. Azure Holding Group | Generation Asia vs. Four Leaf Acquisition |
| Athena Technology vs. Alpha Star Acquisition | Athena Technology vs. Alpha One | Athena Technology vs. A SPAC II |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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