Correlation Between Aldel Financial and CAVA Group,

Can any of the company-specific risk be diversified away by investing in both Aldel Financial and CAVA Group, 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 Aldel Financial and CAVA Group, into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Aldel Financial II and CAVA Group,, you can compare the effects of market volatilities on Aldel Financial and CAVA Group, 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 Aldel Financial with a short position of CAVA Group,. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aldel Financial and CAVA Group,.

Diversification Opportunities for Aldel Financial and CAVA Group,

-0.64

Correlation Coefficient

Aldel Financial  CAVA Group,

Excellent diversification

The 3 months correlation between Aldel and CAVA is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Aldel Financial II and CAVA Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CAVA Group, and Aldel Financial 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 Aldel Financial II are associated (or correlated) with CAVA Group,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CAVA Group, has no effect on the direction of Aldel Financial i.e., Aldel Financial and CAVA Group, go up and down completely randomly.

Pair Corralation between Aldel Financial and CAVA Group,

Assuming the 90 days horizon Aldel Financial is expected to generate 246.7 times less return on investment than CAVA Group,. But when comparing it to its historical volatility, Aldel Financial II is 452.83 times less risky than CAVA Group,. It trades about 0.11 of its potential returns per unit of risk. CAVA Group, is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  0.00  in CAVA Group, on September 21, 2024 and sell it today you would earn a total of  11,705  from holding CAVA Group, or generate 9.223372036854776E16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	10.97%
Values	Daily Returns

Aldel Financial II  vs.  CAVA Group,

Aldel Financial II

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Aldel Financial II are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable technical and fundamental indicators, Aldel Financial is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

CAVA Group,

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CAVA Group, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Aldel Financial and CAVA Group,

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

The idea behind Aldel Financial II and CAVA Group, 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 Commodity Directory module to find actively traded commodities issued by global exchanges.