Correlation Between Iconic Sports and Concord Acquisition
Can any of the company-specific risk be diversified away by investing in both Iconic Sports and Concord 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 Iconic Sports and Concord Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Iconic Sports Acquisition and Concord Acquisition Corp, you can compare the effects of market volatilities on Iconic Sports and Concord 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 Iconic Sports with a short position of Concord Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Iconic Sports and Concord Acquisition.
Diversification Opportunities for Iconic Sports and Concord Acquisition
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Iconic and Concord is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Iconic Sports Acquisition and Concord Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Concord Acquisition Corp and Iconic Sports 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 Iconic Sports Acquisition are associated (or correlated) with Concord Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Concord Acquisition Corp has no effect on the direction of Iconic Sports i.e., Iconic Sports and Concord Acquisition go up and down completely randomly.
Pair Corralation between Iconic Sports and Concord Acquisition
Given the investment horizon of 90 days Iconic Sports is expected to generate 266.93 times less return on investment than Concord Acquisition. But when comparing it to its historical volatility, Iconic Sports Acquisition is 1058.84 times less risky than Concord Acquisition. It trades about 0.29 of its potential returns per unit of risk. Concord Acquisition Corp is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 989.00 in Concord Acquisition Corp on August 30, 2024 and sell it today you would lose (989.00) from holding Concord Acquisition Corp or give up 100.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 38.02% |
| Values | Daily Returns |
Iconic Sports Acquisition vs. Concord Acquisition Corp
Performance |
| Timeline |
| Iconic Sports Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Concord Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Iconic Sports and Concord Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Iconic Sports and Concord Acquisition
The main advantage of trading using opposite Iconic Sports and Concord Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Iconic Sports position performs unexpectedly, Concord 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 Concord Acquisition will offset losses from the drop in Concord Acquisition's long position.The idea behind Iconic Sports Acquisition and Concord Acquisition Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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