Correlation Between YHN Acquisition and AA Mission
Can any of the company-specific risk be diversified away by investing in both YHN Acquisition and AA Mission 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 YHN Acquisition and AA Mission into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between YHN Acquisition I and AA Mission Acquisition, you can compare the effects of market volatilities on YHN Acquisition and AA Mission 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 YHN Acquisition with a short position of AA Mission. Check out your portfolio center. Please also check ongoing floating volatility patterns of YHN Acquisition and AA Mission.
Diversification Opportunities for YHN Acquisition and AA Mission
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between YHN and AAM is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding YHN Acquisition I and AA Mission Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AA Mission Acquisition and YHN 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 YHN Acquisition I are associated (or correlated) with AA Mission. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AA Mission Acquisition has no effect on the direction of YHN Acquisition i.e., YHN Acquisition and AA Mission go up and down completely randomly.
Pair Corralation between YHN Acquisition and AA Mission
Assuming the 90 days horizon YHN Acquisition I is expected to generate 1.61 times more return on investment than AA Mission. However, YHN Acquisition is 1.61 times more volatile than AA Mission Acquisition. It trades about 0.26 of its potential returns per unit of risk. AA Mission Acquisition is currently generating about 0.18 per unit of risk. If you would invest 1,000.00 in YHN Acquisition I on August 27, 2024 and sell it today you would earn a total of 19.00 from holding YHN Acquisition I or generate 1.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 96.23% |
| Values | Daily Returns |
YHN Acquisition I vs. AA Mission Acquisition
Performance |
| Timeline |
| YHN Acquisition I |
| AA Mission Acquisition |
YHN Acquisition and AA Mission Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YHN Acquisition and AA Mission
The main advantage of trading using opposite YHN Acquisition and AA Mission positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YHN Acquisition position performs unexpectedly, AA Mission 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 AA Mission will offset losses from the drop in AA Mission's long position.| YHN Acquisition vs. Voyager Acquisition Corp | YHN Acquisition vs. YHN Acquisition I | YHN Acquisition vs. Vine Hill Capital | YHN Acquisition vs. DP Cap Acquisition |
| AA Mission vs. dMY Squared Technology | AA Mission vs. Vine Hill Capital | AA Mission vs. DP Cap Acquisition | AA Mission vs. PowerUp Acquisition Corp |
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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