Correlation Between Software Acquisition and Acco Brands
Can any of the company-specific risk be diversified away by investing in both Software Acquisition and Acco Brands 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 Software Acquisition and Acco Brands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Software Acquisition Group and Acco Brands, you can compare the effects of market volatilities on Software Acquisition and Acco Brands 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 Software Acquisition with a short position of Acco Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Software Acquisition and Acco Brands.
Diversification Opportunities for Software Acquisition and Acco Brands
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Software and Acco is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Software Acquisition Group and Acco Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acco Brands and Software 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 Software Acquisition Group are associated (or correlated) with Acco Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acco Brands has no effect on the direction of Software Acquisition i.e., Software Acquisition and Acco Brands go up and down completely randomly.
Pair Corralation between Software Acquisition and Acco Brands
Given the investment horizon of 90 days Software Acquisition Group is expected to under-perform the Acco Brands. In addition to that, Software Acquisition is 1.57 times more volatile than Acco Brands. It trades about -0.03 of its total potential returns per unit of risk. Acco Brands is currently generating about 0.02 per unit of volatility. If you would invest 538.00 in Acco Brands on September 14, 2024 and sell it today you would earn a total of 42.50 from holding Acco Brands or generate 7.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Software Acquisition Group vs. Acco Brands
Performance |
| Timeline |
| Software Acquisition |
| Acco Brands |
Software Acquisition and Acco Brands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Software Acquisition and Acco Brands
The main advantage of trading using opposite Software Acquisition and Acco Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Software Acquisition position performs unexpectedly, Acco Brands 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 Acco Brands will offset losses from the drop in Acco Brands' long position.| Software Acquisition vs. Liberty Media | Software Acquisition vs. Atlanta Braves Holdings, | Software Acquisition vs. News Corp B | Software Acquisition vs. News Corp A |
| Acco Brands vs. HNI Corp | Acco Brands vs. Steelcase | Acco Brands vs. Ennis Inc | Acco Brands vs. Acacia Research |
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 CEOs Directory module to screen CEOs from public companies around the world.
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