Correlation Between SupplyMe Capital and ACG Acquisition
Can any of the company-specific risk be diversified away by investing in both SupplyMe Capital and ACG 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 SupplyMe Capital and ACG Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SupplyMe Capital PLC and ACG Acquisition Co, you can compare the effects of market volatilities on SupplyMe Capital and ACG 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 SupplyMe Capital with a short position of ACG Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of SupplyMe Capital and ACG Acquisition.
Diversification Opportunities for SupplyMe Capital and ACG Acquisition
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between SupplyMe and ACG is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding SupplyMe Capital PLC and ACG Acquisition Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ACG Acquisition and SupplyMe Capital 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 SupplyMe Capital PLC are associated (or correlated) with ACG Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ACG Acquisition has no effect on the direction of SupplyMe Capital i.e., SupplyMe Capital and ACG Acquisition go up and down completely randomly.
Pair Corralation between SupplyMe Capital and ACG Acquisition
Assuming the 90 days trading horizon SupplyMe Capital PLC is expected to under-perform the ACG Acquisition. But the stock apears to be less risky and, when comparing its historical volatility, SupplyMe Capital PLC is 9.7 times less risky than ACG Acquisition. The stock trades about -0.09 of its potential returns per unit of risk. The ACG Acquisition Co is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,085 in ACG Acquisition Co on September 2, 2024 and sell it today you would lose (575.00) from holding ACG Acquisition Co or give up 53.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SupplyMe Capital PLC vs. ACG Acquisition Co
Performance |
| Timeline |
| SupplyMe Capital PLC |
| ACG Acquisition |
SupplyMe Capital and ACG Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SupplyMe Capital and ACG Acquisition
The main advantage of trading using opposite SupplyMe Capital and ACG Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SupplyMe Capital position performs unexpectedly, ACG 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 ACG Acquisition will offset losses from the drop in ACG Acquisition's long position.| SupplyMe Capital vs. Lloyds Banking Group | SupplyMe Capital vs. Premier African Minerals | SupplyMe Capital vs. SANTANDER UK 8 | SupplyMe Capital vs. 88 Energy |
| ACG Acquisition vs. Wheaton Precious Metals | ACG Acquisition vs. Lundin Mining Corp | ACG Acquisition vs. Europa Metals | ACG Acquisition vs. AMG Advanced Metallurgical |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |