Correlation Between AltC Acquisition and Churchill Capital

Can any of the company-specific risk be diversified away by investing in both AltC Acquisition and Churchill Capital 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 AltC Acquisition and Churchill Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between AltC Acquisition Corp and Churchill Capital VI, you can compare the effects of market volatilities on AltC Acquisition and Churchill Capital 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 AltC Acquisition with a short position of Churchill Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of AltC Acquisition and Churchill Capital.

Diversification Opportunities for AltC Acquisition and Churchill Capital

0.39

Correlation Coefficient

AltC Acquisition  Churchill Capital

Weak diversification

The 3 months correlation between AltC and Churchill is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding AltC Acquisition Corp and Churchill Capital VI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Churchill Capital and AltC 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 AltC Acquisition Corp are associated (or correlated) with Churchill Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Churchill Capital has no effect on the direction of AltC Acquisition i.e., AltC Acquisition and Churchill Capital go up and down completely randomly.

Pair Corralation between AltC Acquisition and Churchill Capital

Given the investment horizon of 90 days AltC Acquisition Corp is expected to generate 2.25 times more return on investment than Churchill Capital. However, AltC Acquisition is 2.25 times more volatile than Churchill Capital VI. It trades about 0.08 of its potential returns per unit of risk. Churchill Capital VI is currently generating about 0.16 per unit of risk. If you would invest  996.00  in AltC Acquisition Corp on September 24, 2024 and sell it today you would earn a total of  40.00  from holding AltC Acquisition Corp or generate 4.02% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	99.29%
Values	Daily Returns

AltC Acquisition Corp  vs.  Churchill Capital VI

AltC Acquisition Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AltC Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, AltC Acquisition is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Churchill Capital

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Churchill Capital VI has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Churchill Capital is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with AltC Acquisition and Churchill Capital

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

The idea behind AltC Acquisition Corp and Churchill Capital VI 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.