Correlation Between Acropolis Infrastructure and Ares AcquisitionII

Can any of the company-specific risk be diversified away by investing in both Acropolis Infrastructure and Ares AcquisitionII 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 Acropolis Infrastructure and Ares AcquisitionII into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Acropolis Infrastructure Acquisition and Ares Acquisition, you can compare the effects of market volatilities on Acropolis Infrastructure and Ares AcquisitionII 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 Acropolis Infrastructure with a short position of Ares AcquisitionII. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acropolis Infrastructure and Ares AcquisitionII.

Diversification Opportunities for Acropolis Infrastructure and Ares AcquisitionII

0.0

Correlation Coefficient

Acropolis Infrastructure  Ares AcquisitionII

Pay attention - limited upside

The 3 months correlation between Acropolis and Ares is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Acropolis Infrastructure Acqui and Ares Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ares AcquisitionII and Acropolis Infrastructure 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 Acropolis Infrastructure Acquisition are associated (or correlated) with Ares AcquisitionII. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ares AcquisitionII has no effect on the direction of Acropolis Infrastructure i.e., Acropolis Infrastructure and Ares AcquisitionII go up and down completely randomly.

Pair Corralation between Acropolis Infrastructure and Ares AcquisitionII

If you would invest  1,124  in Ares Acquisition on December 22, 2024 and sell it today you would earn a total of  43.00  from holding Ares Acquisition or generate 3.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Acropolis Infrastructure Acqui  vs.  Ares Acquisition

Acropolis Infrastructure

Risk-Adjusted Performance

Very Weak

Over the last 90 days Acropolis Infrastructure Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Acropolis Infrastructure is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Ares AcquisitionII

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Ares Acquisition are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Ares AcquisitionII is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Acropolis Infrastructure and Ares AcquisitionII

The main advantage of trading using opposite Acropolis Infrastructure and Ares AcquisitionII positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acropolis Infrastructure position performs unexpectedly, Ares AcquisitionII 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 Ares AcquisitionII will offset losses from the drop in Ares AcquisitionII's long position.

The idea behind Acropolis Infrastructure Acquisition and Ares Acquisition pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.