Correlation Between Metals Acquisition and Cactus Acquisition
Can any of the company-specific risk be diversified away by investing in both Metals Acquisition and Cactus 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 Metals Acquisition and Cactus Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Metals Acquisition Limited and Cactus Acquisition Corp, you can compare the effects of market volatilities on Metals Acquisition and Cactus 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 Metals Acquisition with a short position of Cactus Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Metals Acquisition and Cactus Acquisition.
Diversification Opportunities for Metals Acquisition and Cactus Acquisition
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Metals and Cactus is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Metals Acquisition Limited and Cactus Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cactus Acquisition Corp and Metals 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 Metals Acquisition Limited are associated (or correlated) with Cactus Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cactus Acquisition Corp has no effect on the direction of Metals Acquisition i.e., Metals Acquisition and Cactus Acquisition go up and down completely randomly.
Pair Corralation between Metals Acquisition and Cactus Acquisition
Given the investment horizon of 90 days Metals Acquisition Limited is expected to generate 4.39 times more return on investment than Cactus Acquisition. However, Metals Acquisition is 4.39 times more volatile than Cactus Acquisition Corp. It trades about 0.08 of its potential returns per unit of risk. Cactus Acquisition Corp is currently generating about 0.31 per unit of risk. If you would invest 1,270 in Metals Acquisition Limited on September 13, 2024 and sell it today you would earn a total of 49.00 from holding Metals Acquisition Limited or generate 3.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Metals Acquisition Limited vs. Cactus Acquisition Corp
Performance |
| Timeline |
| Metals Acquisition |
| Cactus Acquisition Corp |
Metals Acquisition and Cactus Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Metals Acquisition and Cactus Acquisition
The main advantage of trading using opposite Metals Acquisition and Cactus Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Metals Acquisition position performs unexpectedly, Cactus 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 Cactus Acquisition will offset losses from the drop in Cactus Acquisition's long position.The idea behind Metals Acquisition Limited and Cactus 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.| Cactus Acquisition vs. Visa Class A | Cactus Acquisition vs. Diamond Hill Investment | Cactus Acquisition vs. Distoken Acquisition | Cactus Acquisition vs. AllianceBernstein Holding LP |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |