Correlation Between ST Energy and Stratim Cloud
Can any of the company-specific risk be diversified away by investing in both ST Energy and Stratim Cloud 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 ST Energy and Stratim Cloud into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ST Energy Transition and Stratim Cloud Acquisition, you can compare the effects of market volatilities on ST Energy and Stratim Cloud 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 ST Energy with a short position of Stratim Cloud. Check out your portfolio center. Please also check ongoing floating volatility patterns of ST Energy and Stratim Cloud.
Diversification Opportunities for ST Energy and Stratim Cloud
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between STET and Stratim is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding ST Energy Transition and Stratim Cloud Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stratim Cloud Acquisition and ST Energy 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 ST Energy Transition are associated (or correlated) with Stratim Cloud. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stratim Cloud Acquisition has no effect on the direction of ST Energy i.e., ST Energy and Stratim Cloud go up and down completely randomly.
Pair Corralation between ST Energy and Stratim Cloud
If you would invest 1,030 in Stratim Cloud Acquisition on August 31, 2024 and sell it today you would earn a total of 13.00 from holding Stratim Cloud Acquisition or generate 1.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 3.85% |
| Values | Daily Returns |
ST Energy Transition vs. Stratim Cloud Acquisition
Performance |
| Timeline |
| ST Energy Transition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Stratim Cloud Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
ST Energy and Stratim Cloud Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ST Energy and Stratim Cloud
The main advantage of trading using opposite ST Energy and Stratim Cloud positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ST Energy position performs unexpectedly, Stratim Cloud 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 Stratim Cloud will offset losses from the drop in Stratim Cloud's long position.| ST Energy vs. A SPAC II | ST Energy vs. Athena Technology Acquisition | ST Energy vs. Hudson Acquisition I | ST Energy vs. Marblegate 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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