Correlation Between Hertz Global and AlphaVest Acquisition
Can any of the company-specific risk be diversified away by investing in both Hertz Global and AlphaVest 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 Hertz Global and AlphaVest Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hertz Global Holdings and AlphaVest Acquisition Corp, you can compare the effects of market volatilities on Hertz Global and AlphaVest 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 Hertz Global with a short position of AlphaVest Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hertz Global and AlphaVest Acquisition.
Diversification Opportunities for Hertz Global and AlphaVest Acquisition
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hertz and AlphaVest is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Hertz Global Holdings and AlphaVest Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AlphaVest Acquisition and Hertz 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 Hertz Global Holdings are associated (or correlated) with AlphaVest Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AlphaVest Acquisition has no effect on the direction of Hertz Global i.e., Hertz Global and AlphaVest Acquisition go up and down completely randomly.
Pair Corralation between Hertz Global and AlphaVest Acquisition
Considering the 90-day investment horizon Hertz Global is expected to generate 57.25 times less return on investment than AlphaVest Acquisition. But when comparing it to its historical volatility, Hertz Global Holdings is 21.04 times less risky than AlphaVest Acquisition. It trades about 0.04 of its potential returns per unit of risk. AlphaVest Acquisition Corp is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 10.00 in AlphaVest Acquisition Corp on January 11, 2025 and sell it today you would earn a total of 13.00 from holding AlphaVest Acquisition Corp or generate 130.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 77.18% |
| Values | Daily Returns |
Hertz Global Holdings vs. AlphaVest Acquisition Corp
Performance |
| Timeline |
| Hertz Global Holdings |
| AlphaVest Acquisition |
Hertz Global and AlphaVest Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hertz Global and AlphaVest Acquisition
The main advantage of trading using opposite Hertz Global and AlphaVest Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hertz Global position performs unexpectedly, AlphaVest 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 AlphaVest Acquisition will offset losses from the drop in AlphaVest Acquisition's long position.| Hertz Global vs. United Rentals | Hertz Global vs. Ryder System | Hertz Global vs. Herc Holdings | Hertz Global vs. Hertz Global Hldgs |
| AlphaVest Acquisition vs. BBB Foods | AlphaVest Acquisition vs. Allegion PLC | AlphaVest Acquisition vs. Aldel Financial II | AlphaVest Acquisition vs. Paranovus Entertainment Technology |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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