Correlation Between OCA Acquisition and ESH Acquisition
Can any of the company-specific risk be diversified away by investing in both OCA Acquisition and ESH 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 ESH 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 ESH Acquisition Corp, you can compare the effects of market volatilities on OCA Acquisition and ESH 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 ESH Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of OCA Acquisition and ESH Acquisition.
Diversification Opportunities for OCA Acquisition and ESH Acquisition
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between OCA and ESH is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding OCA Acquisition Corp and ESH Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ESH 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 ESH Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ESH Acquisition Corp has no effect on the direction of OCA Acquisition i.e., OCA Acquisition and ESH Acquisition go up and down completely randomly.
Pair Corralation between OCA Acquisition and ESH Acquisition
If you would invest 7.51 in ESH Acquisition Corp on September 2, 2024 and sell it today you would lose (0.93) from holding ESH Acquisition Corp or give up 12.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 10.0% |
| Values | Daily Returns |
OCA Acquisition Corp vs. ESH Acquisition Corp
Performance |
| Timeline |
| OCA Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| ESH Acquisition Corp |
OCA Acquisition and ESH Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OCA Acquisition and ESH Acquisition
The main advantage of trading using opposite OCA Acquisition and ESH Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OCA Acquisition position performs unexpectedly, ESH 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 ESH Acquisition will offset losses from the drop in ESH Acquisition's long position.The idea behind OCA Acquisition Corp and ESH 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.| ESH Acquisition vs. dMY Squared Technology | ESH Acquisition vs. YHN Acquisition I | ESH Acquisition vs. YHN Acquisition I | ESH Acquisition vs. PowerUp 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |