Correlation Between OCA Acquisition and APx Acquisition
Can any of the company-specific risk be diversified away by investing in both OCA Acquisition and APx 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 OCA Acquisition and APx Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OCA Acquisition Corp and APx Acquisition Corp, you can compare the effects of market volatilities on OCA Acquisition and APx 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 OCA Acquisition with a short position of APx Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of OCA Acquisition and APx Acquisition.
Diversification Opportunities for OCA Acquisition and APx Acquisition
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between OCA and APx is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding OCA Acquisition Corp and APx Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on APx Acquisition Corp and OCA 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 OCA Acquisition Corp are associated (or correlated) with APx Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of APx Acquisition Corp has no effect on the direction of OCA Acquisition i.e., OCA Acquisition and APx Acquisition go up and down completely randomly.
Pair Corralation between OCA Acquisition and APx Acquisition
Assuming the 90 days horizon OCA Acquisition Corp is expected to generate 3.23 times more return on investment than APx Acquisition. However, OCA Acquisition is 3.23 times more volatile than APx Acquisition Corp. It trades about 0.02 of its potential returns per unit of risk. APx Acquisition Corp is currently generating about 0.03 per unit of risk. If you would invest 1,084 in OCA Acquisition Corp on September 1, 2024 and sell it today you would earn a total of 26.00 from holding OCA Acquisition Corp or generate 2.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 55.68% |
| Values | Daily Returns |
OCA Acquisition Corp vs. APx Acquisition Corp
Performance |
| Timeline |
| OCA Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| APx Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
OCA Acquisition and APx Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OCA Acquisition and APx Acquisition
The main advantage of trading using opposite OCA Acquisition and APx Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OCA Acquisition position performs unexpectedly, APx 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 APx Acquisition will offset losses from the drop in APx Acquisition's long position.The idea behind OCA Acquisition Corp and APx 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |