Correlation Between State Street and PowerUp Acquisition
Can any of the company-specific risk be diversified away by investing in both State Street and PowerUp 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 State Street and PowerUp Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between State Street Corp and PowerUp Acquisition Corp, you can compare the effects of market volatilities on State Street and PowerUp 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 State Street with a short position of PowerUp Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of State Street and PowerUp Acquisition.
Diversification Opportunities for State Street and PowerUp Acquisition
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between State and PowerUp is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding State Street Corp and PowerUp Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PowerUp Acquisition Corp and State Street 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 State Street Corp are associated (or correlated) with PowerUp Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PowerUp Acquisition Corp has no effect on the direction of State Street i.e., State Street and PowerUp Acquisition go up and down completely randomly.
Pair Corralation between State Street and PowerUp Acquisition
Considering the 90-day investment horizon State Street Corp is expected to generate 0.82 times more return on investment than PowerUp Acquisition. However, State Street Corp is 1.22 times less risky than PowerUp Acquisition. It trades about 0.07 of its potential returns per unit of risk. PowerUp Acquisition Corp is currently generating about 0.02 per unit of risk. If you would invest 6,961 in State Street Corp on August 31, 2024 and sell it today you would earn a total of 2,890 from holding State Street Corp or generate 41.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.73% |
| Values | Daily Returns |
State Street Corp vs. PowerUp Acquisition Corp
Performance |
| Timeline |
| State Street Corp |
| PowerUp Acquisition Corp |
State Street and PowerUp Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with State Street and PowerUp Acquisition
The main advantage of trading using opposite State Street and PowerUp Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if State Street position performs unexpectedly, PowerUp 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 PowerUp Acquisition will offset losses from the drop in PowerUp Acquisition's long position.| State Street vs. Northern Trust | State Street vs. Franklin Resources | State Street vs. Invesco Plc | State Street vs. T Rowe Price |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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