Correlation Between LF Capital and TLGY Acquisition
Can any of the company-specific risk be diversified away by investing in both LF Capital and TLGY 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 LF Capital and TLGY Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LF Capital Acquisition and TLGY Acquisition Corp, you can compare the effects of market volatilities on LF Capital and TLGY 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 LF Capital with a short position of TLGY Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of LF Capital and TLGY Acquisition.
Diversification Opportunities for LF Capital and TLGY Acquisition
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between LFAC and TLGY is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding LF Capital Acquisition and TLGY Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TLGY Acquisition Corp and LF 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 LF Capital Acquisition are associated (or correlated) with TLGY Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TLGY Acquisition Corp has no effect on the direction of LF Capital i.e., LF Capital and TLGY Acquisition go up and down completely randomly.
Pair Corralation between LF Capital and TLGY Acquisition
If you would invest 1,158 in TLGY Acquisition Corp on September 1, 2024 and sell it today you would earn a total of 6.00 from holding TLGY Acquisition Corp or generate 0.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 4.55% |
| Values | Daily Returns |
LF Capital Acquisition vs. TLGY Acquisition Corp
Performance |
| Timeline |
| LF Capital Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| TLGY Acquisition Corp |
LF Capital and TLGY Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LF Capital and TLGY Acquisition
The main advantage of trading using opposite LF Capital and TLGY Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LF Capital position performs unexpectedly, TLGY 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 TLGY Acquisition will offset losses from the drop in TLGY Acquisition's long position.| LF Capital vs. Swiftmerge Acquisition Corp | LF Capital vs. Latamgrowth SPAC Unit | LF Capital vs. TLGY Acquisition Corp | LF Capital vs. Qomolangma Acquisition Corp |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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