Correlation Between Xp and Bayview Acquisition
Can any of the company-specific risk be diversified away by investing in both Xp and Bayview 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 Xp and Bayview Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xp Inc and Bayview Acquisition Corp, you can compare the effects of market volatilities on Xp and Bayview 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 Xp with a short position of Bayview Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xp and Bayview Acquisition.
Diversification Opportunities for Xp and Bayview Acquisition
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Xp and Bayview is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Xp Inc and Bayview Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bayview Acquisition Corp and Xp 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 Xp Inc are associated (or correlated) with Bayview Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bayview Acquisition Corp has no effect on the direction of Xp i.e., Xp and Bayview Acquisition go up and down completely randomly.
Pair Corralation between Xp and Bayview Acquisition
Allowing for the 90-day total investment horizon Xp Inc is expected to generate 16.27 times more return on investment than Bayview Acquisition. However, Xp is 16.27 times more volatile than Bayview Acquisition Corp. It trades about 0.01 of its potential returns per unit of risk. Bayview Acquisition Corp is currently generating about 0.14 per unit of risk. If you would invest 1,504 in Xp Inc on August 29, 2024 and sell it today you would lose (9.00) from holding Xp Inc or give up 0.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 46.37% |
| Values | Daily Returns |
Xp Inc vs. Bayview Acquisition Corp
Performance |
| Timeline |
| Xp Inc |
| Bayview Acquisition Corp |
Xp and Bayview Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xp and Bayview Acquisition
The main advantage of trading using opposite Xp and Bayview Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xp position performs unexpectedly, Bayview 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 Bayview Acquisition will offset losses from the drop in Bayview Acquisition's long position.| Xp vs. Raymond James Financial | Xp vs. Evercore Partners | Xp vs. Selective Insurance Group | Xp vs. Reinsurance Group of |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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