Correlation Between LatAmGrowth SPAC and IX Acquisition
Can any of the company-specific risk be diversified away by investing in both LatAmGrowth SPAC and IX 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 LatAmGrowth SPAC and IX Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LatAmGrowth SPAC and IX Acquisition Corp, you can compare the effects of market volatilities on LatAmGrowth SPAC and IX 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 LatAmGrowth SPAC with a short position of IX Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of LatAmGrowth SPAC and IX Acquisition.
Diversification Opportunities for LatAmGrowth SPAC and IX Acquisition
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between LatAmGrowth and IXAQ is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding LatAmGrowth SPAC and IX Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IX Acquisition Corp and LatAmGrowth SPAC 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 LatAmGrowth SPAC are associated (or correlated) with IX Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IX Acquisition Corp has no effect on the direction of LatAmGrowth SPAC i.e., LatAmGrowth SPAC and IX Acquisition go up and down completely randomly.
Pair Corralation between LatAmGrowth SPAC and IX Acquisition
Given the investment horizon of 90 days LatAmGrowth SPAC is expected to under-perform the IX Acquisition. In addition to that, LatAmGrowth SPAC is 171.15 times more volatile than IX Acquisition Corp. It trades about -0.13 of its total potential returns per unit of risk. IX Acquisition Corp is currently generating about 0.39 per unit of volatility. If you would invest 1,155 in IX Acquisition Corp on October 25, 2024 and sell it today you would earn a total of 8.00 from holding IX Acquisition Corp or generate 0.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 88.89% |
| Values | Daily Returns |
LatAmGrowth SPAC vs. IX Acquisition Corp
Performance |
| Timeline |
| LatAmGrowth SPAC |
| IX Acquisition Corp |
LatAmGrowth SPAC and IX Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LatAmGrowth SPAC and IX Acquisition
The main advantage of trading using opposite LatAmGrowth SPAC and IX Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LatAmGrowth SPAC position performs unexpectedly, IX 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 IX Acquisition will offset losses from the drop in IX Acquisition's long position.The idea behind LatAmGrowth SPAC and IX 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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