Correlation Between Oracle and Knightswan Acquisition

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Oracle and Knightswan 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 Oracle and Knightswan Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oracle and Knightswan Acquisition Corp, you can compare the effects of market volatilities on Oracle and Knightswan 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 Oracle with a short position of Knightswan Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oracle and Knightswan Acquisition.

Diversification Opportunities for Oracle and Knightswan Acquisition

0.61
  Correlation Coefficient

Poor diversification

The 3 months correlation between Oracle and Knightswan is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Oracle and Knightswan Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Knightswan Acquisition and Oracle 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 Oracle are associated (or correlated) with Knightswan Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Knightswan Acquisition has no effect on the direction of Oracle i.e., Oracle and Knightswan Acquisition go up and down completely randomly.

Pair Corralation between Oracle and Knightswan Acquisition

If you would invest  1,038  in Knightswan Acquisition Corp on September 12, 2024 and sell it today you would earn a total of  0.00  from holding Knightswan Acquisition Corp or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy4.55%
ValuesDaily Returns

Oracle  vs.  Knightswan Acquisition Corp

 Performance 
       Timeline  
Oracle 

Risk-Adjusted Performance

7 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Oracle are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite abnormal fundamental indicators, Oracle may actually be approaching a critical reversion point that can send shares even higher in January 2025.
Knightswan Acquisition 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Knightswan Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Knightswan Acquisition is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Oracle and Knightswan Acquisition Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Oracle and Knightswan Acquisition

The main advantage of trading using opposite Oracle and Knightswan Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oracle position performs unexpectedly, Knightswan 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 Knightswan Acquisition will offset losses from the drop in Knightswan Acquisition's long position.
The idea behind Oracle and Knightswan 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.

Other Complementary Tools

Price Exposure Probability
Analyze equity upside and downside potential for a given time horizon across multiple markets
Transaction History
View history of all your transactions and understand their impact on performance
Headlines Timeline
Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity
Correlation Analysis
Reduce portfolio risk simply by holding instruments which are not perfectly correlated
ETF Categories
List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments