Correlation Between Graf Global and Black Hawk
Can any of the company-specific risk be diversified away by investing in both Graf Global and Black Hawk 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 Graf Global and Black Hawk into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Graf Global Corp and Black Hawk Acquisition, you can compare the effects of market volatilities on Graf Global and Black Hawk 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 Graf Global with a short position of Black Hawk. Check out your portfolio center. Please also check ongoing floating volatility patterns of Graf Global and Black Hawk.
Diversification Opportunities for Graf Global and Black Hawk
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Graf and Black is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Graf Global Corp and Black Hawk Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Black Hawk Acquisition and Graf Global 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 Graf Global Corp are associated (or correlated) with Black Hawk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Black Hawk Acquisition has no effect on the direction of Graf Global i.e., Graf Global and Black Hawk go up and down completely randomly.
Pair Corralation between Graf Global and Black Hawk
Given the investment horizon of 90 days Graf Global is expected to generate 4.09 times less return on investment than Black Hawk. But when comparing it to its historical volatility, Graf Global Corp is 8.12 times less risky than Black Hawk. It trades about 0.04 of its potential returns per unit of risk. Black Hawk Acquisition is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,038 in Black Hawk Acquisition on September 2, 2024 and sell it today you would earn a total of 11.00 from holding Black Hawk Acquisition or generate 1.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Graf Global Corp vs. Black Hawk Acquisition
Performance |
| Timeline |
| Graf Global Corp |
| Black Hawk Acquisition |
Graf Global and Black Hawk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Graf Global and Black Hawk
The main advantage of trading using opposite Graf Global and Black Hawk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Graf Global position performs unexpectedly, Black Hawk 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 Black Hawk will offset losses from the drop in Black Hawk's long position.| Graf Global vs. Voyager Acquisition Corp | Graf Global vs. CO2 Energy Transition | Graf Global vs. Vine Hill Capital | Graf Global vs. DUET Acquisition Corp |
| Black Hawk vs. Voyager Acquisition Corp | Black Hawk vs. CO2 Energy Transition | Black Hawk vs. Vine Hill Capital | Black Hawk vs. DUET 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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