Correlation Between Graf Global and Broad Capital
Can any of the company-specific risk be diversified away by investing in both Graf Global and Broad 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 Graf Global and Broad Capital 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 Broad Capital Acquisition, you can compare the effects of market volatilities on Graf Global and Broad 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 Graf Global with a short position of Broad Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Graf Global and Broad Capital.
Diversification Opportunities for Graf Global and Broad Capital
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Graf and Broad is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Graf Global Corp and Broad Capital Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Broad Capital 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 Broad Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Broad Capital Acquisition has no effect on the direction of Graf Global i.e., Graf Global and Broad Capital go up and down completely randomly.
Pair Corralation between Graf Global and Broad Capital
Given the investment horizon of 90 days Graf Global Corp is expected to under-perform the Broad Capital. But the stock apears to be less risky and, when comparing its historical volatility, Graf Global Corp is 43.59 times less risky than Broad Capital. The stock trades about -0.04 of its potential returns per unit of risk. The Broad Capital Acquisition is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 13.00 in Broad Capital Acquisition on August 23, 2024 and sell it today you would earn a total of 0.00 from holding Broad Capital Acquisition or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 22.73% |
| Values | Daily Returns |
Graf Global Corp vs. Broad Capital Acquisition
Performance |
| Timeline |
| Graf Global Corp |
| Broad Capital Acquisition |
Graf Global and Broad Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Graf Global and Broad Capital
The main advantage of trading using opposite Graf Global and Broad Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Graf Global position performs unexpectedly, Broad 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 Broad Capital will offset losses from the drop in Broad Capital's long position.| Graf Global vs. Distoken Acquisition | Graf Global vs. Voyager Acquisition Corp | Graf Global vs. dMY Squared Technology | Graf Global vs. YHN Acquisition I |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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