Correlation Between Hawks Acquisition and HHG Capital
Can any of the company-specific risk be diversified away by investing in both Hawks Acquisition and HHG 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 Hawks Acquisition and HHG Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hawks Acquisition Corp and HHG Capital Corp, you can compare the effects of market volatilities on Hawks Acquisition and HHG 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 Hawks Acquisition with a short position of HHG Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hawks Acquisition and HHG Capital.
Diversification Opportunities for Hawks Acquisition and HHG Capital
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Hawks and HHG is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Hawks Acquisition Corp and HHG Capital Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HHG Capital Corp and Hawks Acquisition 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 Hawks Acquisition Corp are associated (or correlated) with HHG Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HHG Capital Corp has no effect on the direction of Hawks Acquisition i.e., Hawks Acquisition and HHG Capital go up and down completely randomly.
Pair Corralation between Hawks Acquisition and HHG Capital
Given the investment horizon of 90 days Hawks Acquisition is expected to generate 1.38 times less return on investment than HHG Capital. But when comparing it to its historical volatility, Hawks Acquisition Corp is 5.55 times less risky than HHG Capital. It trades about 0.08 of its potential returns per unit of risk. HHG Capital Corp is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,014 in HHG Capital Corp on August 30, 2024 and sell it today you would earn a total of 98.00 from holding HHG Capital Corp or generate 9.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 31.81% |
| Values | Daily Returns |
Hawks Acquisition Corp vs. HHG Capital Corp
Performance |
| Timeline |
| Hawks Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| HHG Capital Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Hawks Acquisition and HHG Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hawks Acquisition and HHG Capital
The main advantage of trading using opposite Hawks Acquisition and HHG Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hawks Acquisition position performs unexpectedly, HHG 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 HHG Capital will offset losses from the drop in HHG Capital's long position.| Hawks Acquisition vs. International Luxury Products | Hawks Acquisition vs. Cactus Acquisition Corp | Hawks Acquisition vs. Finnovate Acquisition Corp | Hawks Acquisition vs. Welsbach Technology Metals |
| HHG Capital vs. Embrace Change Acquisition | HHG Capital vs. Bannix Acquisition Corp | HHG Capital vs. Global Blockchain Acquisition | HHG Capital vs. Gores Holdings IX |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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