Correlation Between Invesco Advantage and A SPAC
Can any of the company-specific risk be diversified away by investing in both Invesco Advantage and A SPAC 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 Invesco Advantage and A SPAC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invesco Advantage MIT and A SPAC II, you can compare the effects of market volatilities on Invesco Advantage and A SPAC 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 Invesco Advantage with a short position of A SPAC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invesco Advantage and A SPAC.
Diversification Opportunities for Invesco Advantage and A SPAC
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Invesco and ASCB is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Invesco Advantage MIT and A SPAC II in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on A SPAC II and Invesco Advantage 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 Invesco Advantage MIT are associated (or correlated) with A SPAC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of A SPAC II has no effect on the direction of Invesco Advantage i.e., Invesco Advantage and A SPAC go up and down completely randomly.
Pair Corralation between Invesco Advantage and A SPAC
Considering the 90-day investment horizon Invesco Advantage MIT is expected to generate 0.72 times more return on investment than A SPAC. However, Invesco Advantage MIT is 1.38 times less risky than A SPAC. It trades about 0.05 of its potential returns per unit of risk. A SPAC II is currently generating about 0.02 per unit of risk. If you would invest 773.00 in Invesco Advantage MIT on September 4, 2024 and sell it today you would earn a total of 150.00 from holding Invesco Advantage MIT or generate 19.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Invesco Advantage MIT vs. A SPAC II
Performance |
| Timeline |
| Invesco Advantage MIT |
| A SPAC II |
Invesco Advantage and A SPAC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invesco Advantage and A SPAC
The main advantage of trading using opposite Invesco Advantage and A SPAC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco Advantage position performs unexpectedly, A SPAC 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 A SPAC will offset losses from the drop in A SPAC's long position.| Invesco Advantage vs. Invesco Quality Municipal | Invesco Advantage vs. Invesco California Value | Invesco Advantage vs. DWS Municipal Income | Invesco Advantage vs. Invesco Trust For |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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