Correlation Between Western Union and Kairous Acquisition
Can any of the company-specific risk be diversified away by investing in both Western Union and Kairous 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 Western Union and Kairous Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Union Co and Kairous Acquisition Corp, you can compare the effects of market volatilities on Western Union and Kairous 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 Western Union with a short position of Kairous Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Union and Kairous Acquisition.
Diversification Opportunities for Western Union and Kairous Acquisition
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Western and Kairous is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Western Union Co and Kairous Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kairous Acquisition Corp and Western Union 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 Western Union Co are associated (or correlated) with Kairous Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kairous Acquisition Corp has no effect on the direction of Western Union i.e., Western Union and Kairous Acquisition go up and down completely randomly.
Pair Corralation between Western Union and Kairous Acquisition
Allowing for the 90-day total investment horizon Western Union Co is expected to generate 0.08 times more return on investment than Kairous Acquisition. However, Western Union Co is 12.53 times less risky than Kairous Acquisition. It trades about 0.11 of its potential returns per unit of risk. Kairous Acquisition Corp is currently generating about -0.15 per unit of risk. If you would invest 1,076 in Western Union Co on September 1, 2024 and sell it today you would earn a total of 25.00 from holding Western Union Co or generate 2.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 76.19% |
| Values | Daily Returns |
Western Union Co vs. Kairous Acquisition Corp
Performance |
| Timeline |
| Western Union |
| Kairous Acquisition Corp |
Western Union and Kairous Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Union and Kairous Acquisition
The main advantage of trading using opposite Western Union and Kairous Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Union position performs unexpectedly, Kairous 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 Kairous Acquisition will offset losses from the drop in Kairous Acquisition's long position.| Western Union vs. Navient Corp | Western Union vs. Green Dot | Western Union vs. Orix Corp Ads | Western Union vs. FirstCash |
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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |