Correlation Between HHG Capital and Finnovate Acquisition
Can any of the company-specific risk be diversified away by investing in both HHG Capital and Finnovate Acquisition 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 HHG Capital and Finnovate Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HHG Capital Corp and Finnovate Acquisition Corp, you can compare the effects of market volatilities on HHG Capital and Finnovate Acquisition 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 HHG Capital with a short position of Finnovate Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of HHG Capital and Finnovate Acquisition.
Diversification Opportunities for HHG Capital and Finnovate Acquisition
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between HHG and Finnovate is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding HHG Capital Corp and Finnovate Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Finnovate Acquisition and HHG Capital 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 HHG Capital Corp are associated (or correlated) with Finnovate Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Finnovate Acquisition has no effect on the direction of HHG Capital i.e., HHG Capital and Finnovate Acquisition go up and down completely randomly.
Pair Corralation between HHG Capital and Finnovate Acquisition
Given the investment horizon of 90 days HHG Capital is expected to generate 43.8 times less return on investment than Finnovate Acquisition. In addition to that, HHG Capital is 5.62 times more volatile than Finnovate Acquisition Corp. It trades about 0.0 of its total potential returns per unit of risk. Finnovate Acquisition Corp is currently generating about 0.13 per unit of volatility. If you would invest 1,101 in Finnovate Acquisition Corp on August 29, 2024 and sell it today you would earn a total of 61.00 from holding Finnovate Acquisition Corp or generate 5.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 85.89% |
| Values | Daily Returns |
HHG Capital Corp vs. Finnovate Acquisition Corp
Performance |
| Timeline |
| HHG Capital Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Finnovate Acquisition |
HHG Capital and Finnovate Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HHG Capital and Finnovate Acquisition
The main advantage of trading using opposite HHG Capital and Finnovate Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HHG Capital position performs unexpectedly, Finnovate Acquisition 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 Finnovate Acquisition will offset losses from the drop in Finnovate Acquisition's long position.| HHG Capital vs. Embrace Change Acquisition | HHG Capital vs. Bannix Acquisition Corp | HHG Capital vs. Global Blockchain Acquisition | HHG Capital vs. Gores Holdings IX |
| Finnovate Acquisition vs. Broad Capital Acquisition | Finnovate Acquisition vs. Welsbach Technology Metals |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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