Correlation Between Waldencast Acquisition and Kingdee International
Can any of the company-specific risk be diversified away by investing in both Waldencast Acquisition and Kingdee International 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 Waldencast Acquisition and Kingdee International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Waldencast Acquisition Corp and Kingdee International Software, you can compare the effects of market volatilities on Waldencast Acquisition and Kingdee International 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 Waldencast Acquisition with a short position of Kingdee International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Waldencast Acquisition and Kingdee International.
Diversification Opportunities for Waldencast Acquisition and Kingdee International
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Waldencast and Kingdee is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Waldencast Acquisition Corp and Kingdee International Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kingdee International and Waldencast 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 Waldencast Acquisition Corp are associated (or correlated) with Kingdee International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kingdee International has no effect on the direction of Waldencast Acquisition i.e., Waldencast Acquisition and Kingdee International go up and down completely randomly.
Pair Corralation between Waldencast Acquisition and Kingdee International
Given the investment horizon of 90 days Waldencast Acquisition Corp is expected to under-perform the Kingdee International. In addition to that, Waldencast Acquisition is 1.37 times more volatile than Kingdee International Software. It trades about -0.02 of its total potential returns per unit of risk. Kingdee International Software is currently generating about -0.01 per unit of volatility. If you would invest 187.00 in Kingdee International Software on September 2, 2024 and sell it today you would lose (70.00) from holding Kingdee International Software or give up 37.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Waldencast Acquisition Corp vs. Kingdee International Software
Performance |
| Timeline |
| Waldencast Acquisition |
| Kingdee International |
Waldencast Acquisition and Kingdee International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Waldencast Acquisition and Kingdee International
The main advantage of trading using opposite Waldencast Acquisition and Kingdee International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Waldencast Acquisition position performs unexpectedly, Kingdee International 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 Kingdee International will offset losses from the drop in Kingdee International's long position.| Waldencast Acquisition vs. Where Food Comes | Waldencast Acquisition vs. VTEX | Waldencast Acquisition vs. Vertex | Waldencast Acquisition vs. BASE Inc |
| Kingdee International vs. Zhihu Inc ADR | Kingdee International vs. Haverty Furniture Companies | Kingdee International vs. Addus HomeCare | Kingdee International vs. Bassett Furniture Industries |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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