Correlation Between Stagwell and Inflection Point
Can any of the company-specific risk be diversified away by investing in both Stagwell and Inflection Point 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 Stagwell and Inflection Point into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stagwell and Inflection Point Acquisition, you can compare the effects of market volatilities on Stagwell and Inflection Point 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 Stagwell with a short position of Inflection Point. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stagwell and Inflection Point.
Diversification Opportunities for Stagwell and Inflection Point
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Stagwell and Inflection is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Stagwell and Inflection Point Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inflection Point Acq and Stagwell 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 Stagwell are associated (or correlated) with Inflection Point. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inflection Point Acq has no effect on the direction of Stagwell i.e., Stagwell and Inflection Point go up and down completely randomly.
Pair Corralation between Stagwell and Inflection Point
Given the investment horizon of 90 days Stagwell is expected to generate 8.85 times more return on investment than Inflection Point. However, Stagwell is 8.85 times more volatile than Inflection Point Acquisition. It trades about 0.38 of its potential returns per unit of risk. Inflection Point Acquisition is currently generating about 0.22 per unit of risk. If you would invest 650.00 in Stagwell on September 2, 2024 and sell it today you would earn a total of 136.00 from holding Stagwell or generate 20.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stagwell vs. Inflection Point Acquisition
Performance |
| Timeline |
| Stagwell |
| Inflection Point Acq |
Stagwell and Inflection Point Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stagwell and Inflection Point
The main advantage of trading using opposite Stagwell and Inflection Point positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stagwell position performs unexpectedly, Inflection Point 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 Inflection Point will offset losses from the drop in Inflection Point's long position.| Stagwell vs. ADTRAN Inc | Stagwell vs. Belden Inc | Stagwell vs. ADC Therapeutics SA | Stagwell vs. Comtech Telecommunications Corp |
| Inflection Point vs. Kinsale Capital Group | Inflection Point vs. GoHealth | Inflection Point vs. Stratasys | Inflection Point vs. NI Holdings |
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 Stocks Directory module to find actively traded stocks across global markets.
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