Correlation Between Gores Holdings and Screaming Eagle
Can any of the company-specific risk be diversified away by investing in both Gores Holdings and Screaming Eagle 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 Gores Holdings and Screaming Eagle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gores Holdings IX and Screaming Eagle Acquisition, you can compare the effects of market volatilities on Gores Holdings and Screaming Eagle 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 Gores Holdings with a short position of Screaming Eagle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gores Holdings and Screaming Eagle.
Diversification Opportunities for Gores Holdings and Screaming Eagle
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Gores and Screaming is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Gores Holdings IX and Screaming Eagle Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Screaming Eagle Acqu and Gores Holdings 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 Gores Holdings IX are associated (or correlated) with Screaming Eagle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Screaming Eagle Acqu has no effect on the direction of Gores Holdings i.e., Gores Holdings and Screaming Eagle go up and down completely randomly.
Pair Corralation between Gores Holdings and Screaming Eagle
Assuming the 90 days horizon Gores Holdings IX is expected to generate 10.65 times more return on investment than Screaming Eagle. However, Gores Holdings is 10.65 times more volatile than Screaming Eagle Acquisition. It trades about 0.11 of its potential returns per unit of risk. Screaming Eagle Acquisition is currently generating about 0.01 per unit of risk. If you would invest 20.00 in Gores Holdings IX on August 26, 2024 and sell it today you would lose (15.56) from holding Gores Holdings IX or give up 77.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 41.79% |
| Values | Daily Returns |
Gores Holdings IX vs. Screaming Eagle Acquisition
Performance |
| Timeline |
| Gores Holdings IX |
| Screaming Eagle Acqu |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Gores Holdings and Screaming Eagle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gores Holdings and Screaming Eagle
The main advantage of trading using opposite Gores Holdings and Screaming Eagle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gores Holdings position performs unexpectedly, Screaming Eagle 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 Screaming Eagle will offset losses from the drop in Screaming Eagle's long position.| Gores Holdings vs. PowerUp Acquisition Corp | Gores Holdings vs. Aurora Innovation | Gores Holdings vs. HUMANA INC | Gores Holdings vs. Aquagold International |
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.
Other Complementary Tools
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |