Correlation Between Procter Gamble and Accretion Acquisition
Can any of the company-specific risk be diversified away by investing in both Procter Gamble and Accretion 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 Procter Gamble and Accretion Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Procter Gamble and Accretion Acquisition Corp, you can compare the effects of market volatilities on Procter Gamble and Accretion 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 Procter Gamble with a short position of Accretion Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Procter Gamble and Accretion Acquisition.
Diversification Opportunities for Procter Gamble and Accretion Acquisition
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Procter and Accretion is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Procter Gamble and Accretion Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Accretion Acquisition and Procter Gamble 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 Procter Gamble are associated (or correlated) with Accretion Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Accretion Acquisition has no effect on the direction of Procter Gamble i.e., Procter Gamble and Accretion Acquisition go up and down completely randomly.
Pair Corralation between Procter Gamble and Accretion Acquisition
Allowing for the 90-day total investment horizon Procter Gamble is expected to generate 48.43 times less return on investment than Accretion Acquisition. But when comparing it to its historical volatility, Procter Gamble is 22.5 times less risky than Accretion Acquisition. It trades about 0.04 of its potential returns per unit of risk. Accretion Acquisition Corp is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 9.00 in Accretion Acquisition Corp on September 12, 2024 and sell it today you would lose (1.00) from holding Accretion Acquisition Corp or give up 11.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 21.21% |
| Values | Daily Returns |
Procter Gamble vs. Accretion Acquisition Corp
Performance |
| Timeline |
| Procter Gamble |
| Accretion Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Procter Gamble and Accretion Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Procter Gamble and Accretion Acquisition
The main advantage of trading using opposite Procter Gamble and Accretion Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Procter Gamble position performs unexpectedly, Accretion 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 Accretion Acquisition will offset losses from the drop in Accretion Acquisition's long position.| Procter Gamble vs. Victory Integrity Smallmid Cap | Procter Gamble vs. Hilton Worldwide Holdings | Procter Gamble vs. NVIDIA | Procter Gamble vs. JPMorgan Chase Co |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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