Correlation Between PowerUp Acquisition and Cartica Acquisition
Can any of the company-specific risk be diversified away by investing in both PowerUp Acquisition and Cartica 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 PowerUp Acquisition and Cartica Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PowerUp Acquisition Corp and Cartica Acquisition Corp, you can compare the effects of market volatilities on PowerUp Acquisition and Cartica 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 PowerUp Acquisition with a short position of Cartica Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of PowerUp Acquisition and Cartica Acquisition.
Diversification Opportunities for PowerUp Acquisition and Cartica Acquisition
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between PowerUp and Cartica is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding PowerUp Acquisition Corp and Cartica Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cartica Acquisition Corp and PowerUp 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 PowerUp Acquisition Corp are associated (or correlated) with Cartica Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cartica Acquisition Corp has no effect on the direction of PowerUp Acquisition i.e., PowerUp Acquisition and Cartica Acquisition go up and down completely randomly.
Pair Corralation between PowerUp Acquisition and Cartica Acquisition
Assuming the 90 days horizon PowerUp Acquisition Corp is expected to generate 3.12 times more return on investment than Cartica Acquisition. However, PowerUp Acquisition is 3.12 times more volatile than Cartica Acquisition Corp. It trades about 0.02 of its potential returns per unit of risk. Cartica Acquisition Corp is currently generating about 0.04 per unit of risk. If you would invest 1,026 in PowerUp Acquisition Corp on August 30, 2024 and sell it today you would earn a total of 119.00 from holding PowerUp Acquisition Corp or generate 11.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PowerUp Acquisition Corp vs. Cartica Acquisition Corp
Performance |
| Timeline |
| PowerUp Acquisition Corp |
| Cartica Acquisition Corp |
PowerUp Acquisition and Cartica Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PowerUp Acquisition and Cartica Acquisition
The main advantage of trading using opposite PowerUp Acquisition and Cartica Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PowerUp Acquisition position performs unexpectedly, Cartica 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 Cartica Acquisition will offset losses from the drop in Cartica Acquisition's long position.The idea behind PowerUp Acquisition Corp and Cartica 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Bonds Directory Find actively traded corporate debentures issued by US companies |