Correlation Between YHN Acquisition and Charlton Aria
Can any of the company-specific risk be diversified away by investing in both YHN Acquisition and Charlton Aria 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 Charlton Aria 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 Charlton Aria Acquisition, you can compare the effects of market volatilities on YHN Acquisition and Charlton Aria 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 Charlton Aria. Check out your portfolio center. Please also check ongoing floating volatility patterns of YHN Acquisition and Charlton Aria.
Diversification Opportunities for YHN Acquisition and Charlton Aria
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between YHN and Charlton is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding YHN Acquisition I and Charlton Aria Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Charlton Aria 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 Charlton Aria. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Charlton Aria Acquisition has no effect on the direction of YHN Acquisition i.e., YHN Acquisition and Charlton Aria go up and down completely randomly.
Pair Corralation between YHN Acquisition and Charlton Aria
Assuming the 90 days horizon YHN Acquisition I is expected to generate 0.48 times more return on investment than Charlton Aria. However, YHN Acquisition I is 2.1 times less risky than Charlton Aria. It trades about 0.32 of its potential returns per unit of risk. Charlton Aria Acquisition is currently generating about 0.12 per unit of risk. If you would invest 1,010 in YHN Acquisition I on October 24, 2024 and sell it today you would earn a total of 7.00 from holding YHN Acquisition I or generate 0.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 89.47% |
| Values | Daily Returns |
YHN Acquisition I vs. Charlton Aria Acquisition
Performance |
| Timeline |
| YHN Acquisition I |
| Charlton Aria Acquisition |
YHN Acquisition and Charlton Aria Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YHN Acquisition and Charlton Aria
The main advantage of trading using opposite YHN Acquisition and Charlton Aria positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YHN Acquisition position performs unexpectedly, Charlton Aria 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 Charlton Aria will offset losses from the drop in Charlton Aria's long position.| YHN Acquisition vs. Voyager Acquisition Corp | YHN Acquisition vs. CO2 Energy Transition | YHN Acquisition vs. Vine Hill Capital | YHN Acquisition vs. AMODW |
| Charlton Aria vs. Weibo Corp | Charlton Aria vs. Sphere Entertainment Co | Charlton Aria vs. Space Communication | Charlton Aria vs. Tapestry |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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